TCR_Public/030822.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

             Friday, August 22, 2003, Vol. 7, No. 166   

                          Headlines

ACCRUE SOFTWARE: Voluntary Chapter 11 Case Summary
ACP: Wants to Continue Employing Ordinary Course Professionals
ACT MANUFACTURING: Massachusetts Court Confirms Liquidating Plan
AGILENT: Appoints Young K. Sohn to Head Semicon. Products Group
ALLEGHENY ENERGY: Terminates Tolling Pact with Las Vegas Cogen.

ALLEGHENY ENERGY: Black Hills Confirms Buyout of Las Vegas Cogen
ALLIANCE GAMING: Proposed $375MM Sr. Secured Facility Rated BB-
AMERCO: Has Until Dec. 17, 2003 to Make Lease-Related Decisions
AMERICANA PUBLISHING: June Net Capital Deficit Stands at $2.5MM
AQUILA INC: Sells about 550,000 Shares to Pay Tax Obligations

ARDENT HEALTH: Completes $225MM Financing via Private Placement
ATCHISON CASTING: Turns to Alvarez & Marsal for Financial Advice
BIOSPECIFICS: Limited Liquidity Raise Going Concern Uncertainty
BOOTS & COOTS: Provides Summary of Annual Shareholders Meeting  
BRM HOLDINGS: Asks Court to Enter Final Decree Closing the Cases

CABLETEL COMMS: Default on Note Possible if Negotiation Fails
CELL ROBOTICS: Needs New Financing to Repay Current Indebtedness
CHAMPIONLYTE HOLDINGS: Red Ink Continued to Flow in 2nd Quarter
CIRTRAN: June 30 Working Capital Deficit Widens to $5 Million
CKE RESTAURANTS: Reports Period 7 and 2nd Qtr. Same-Store Sales

CLASSIC COMMS: Entry of Final Decree Delayed Until June 24, 2004
CONSUMERS ENERGY: Fitch Rates $400MM 144A FMBs Issuances at BB+
CORAM HEALTHCARE: Trustee Has Until Dec. 31 to Decide on Leases
CORUS: Weaker-than-Expected Cash Flows Prompt Negative Outlook
CRYOLIFE INC: Names Dr. Ray as Associate Medical Director

DDI CORP: June 30 Balance Sheet Insolvency Widens to $198 Mill.
DIALOG GROUP: Delays Filing of Form 10-Q for June Quarter
DIRECTV: Has Until September 15 to Move Pending Actions to Del.
DRS TECH: Ratings Under Review for Possible Downgrade
DYNAMOTIVE ENERGY: Completes Filing Audited Financial Statements

EAGLE FOOD CENTERS: Selects Best Bids for Assets of 8 Stores
EL PASO ELECTRIC: Moody's Confirms Baa3 Sr. Secure Debt Rating
EMAGIN CORP: June 30 Net Capital Deficit Cut by Half to $6 Mill.
ENRON CORP: Wind Unit Wants to Restructure Intercompany Loans
FEDERAL-MOGUL: Wants to Pull Plug on Forklift Equipment Leases

FRONTLINE COMMS: Needs Fresh Funds to Satisfy Debt Obligations
GENERAL MEDIA: Wants Access to $3 Million Interim DIP Financing
GENTEK INC: Court Disallows 10 Claims Totaling $37 Million
GOLDEN EAGLE INT'L: Ability to Continue Operations Uncertain
GOODYEAR TIRE: Enters 3-Year Tentative Labor Agreement with USWA

GOODYEAR TIRE: USWA Confirms Tentative Agreement with Company
HAYES LEMMERZ: HLI Trust Wants Neuberger to Present Documents
INAMED CORP: S&P Assigns BB- Rating to $100M Senior Secured Debt
IPCS INC: Committee Gratified by Ruling in Action vs. Sprint PCS
ITEX CORP: Anticipates Sizeable Loss for Fiscal 2003 4th Quarter

KAISER ALUMINUM: 6th Amendment to Credit Agreement Takes Effect
KRATON POLYMERS: Ratings on Watch Pending Possible Company Sale
LTV: Copperweld Intends to Terminate and Replace Benefit Plans
LUCILLE FARMS: 1st Quarter Results Reflect Business Improvement
MAGELLAN HEALTH: Overview of Third Amended Chapter 11 Plan

MARINER HEALTH: Inks Definitive Pact to Sell Florida Facilities
MASSEY ENERGY: Promotes Baxter Phillips to Chief Fin'l Officer
MEDICALCV INC: Elects Larry Horsch as Chairman of the Board
MERRILL LYNCH: Fitch Affirms B- Rating on $11.7MM Class F Notes
METALLURG: Ratings Cut as Tight Liquidity Pressures Covenants

MICHAELS STORES: Ratings Raised on Better Operating Performance
MILLENNIUM CHEMICALS: June Net Capital Deficit Narrows to $31MM
MILLER INDUSTRIES: Seeks Default Waiver Under Credit Agreement
MIRANT CORP: Court Moves General Claims Bar Date to December 16
MIRANT CORP: EcoElectrica Investments' Chapter 11 Case Summary

MORGAN STANLEY: S&P Ups Ratings on Four Classes of 1996-C1
NAT'L CENTURY: Pain Net Wants Rule 2004 Exam Order Reconsidered
NATIONAL ENERGY: Annual Shareholders' Meeting Slated for Sept. 9
NORTHWESTERN CORP: Elects Gary G. Drook President and CEO
OM GROUP: Stephen D. Dunmead to Lead Company's Cobalt Business

OSE USA: June 29 Net Capital Deficit Jumps-Up to $43 Million
OWENS CORNING: Committee Wants to Intervene in Avoidance Actions
PENNSYLVANIA DENTAL: S&P Withdraws 'BB' Ratings at Co.'s Request
PG&E NATIONAL: USGen Committee Hires Reed Smith as Counsel
PHOTOGEN: Enters Agreement to Cure Default Under Promissory Note

PILLOWTEX CORP: Court OKs Logan's Appointment as Claims Agent
PRINCETON VIDEO: Completes Sale of Assets to PVI Virtual Media
PROTARGA: Selling Substantially All Assets to Spectrum for $2 Mil.
RAVEN MOON: June 30 Balance Sheet Upside-Down by $320,000
RIBAPHARM INC: ICN's Tender Offer for Ribapharm Shares Completed

ROMACORP INC: Advances Plan to Restructure 12% Senior Notes
SECURED SERVICES: Hires J.H. Cohn as Grant Thornton Replacement
SEROLOGICALS: Completes 4.75% Convertible Debentures Offering
SIMTROL INC: Completes Sale of 1.7M Shares via Private Placement
SOLUTIA INC: Strikes Settlement of Alabama PCB Litigation

SPIEGEL GROUP: Esplanade Demands Tax Payment Amounting to $1MM++
STRUCTURED ASSET: Fitch Upgrades Class I Note Rating to BB+
TOP FURNITURE: Begins Store Closing Sales at All Calif. Stores
TRUMP HOTELS & CASINO: Intends to Pursue Illinois Gaming License
UNITED AIRLINES: Committee Wants to Expand KPMG Engagement Scope

US AIRWAYS: Resolves Itochu Airlease and Chuo Mitsui Claims
U.S. ENERGY: Plans to Sell Certain Assets to Improve Financials
VICAR OPERATING: S&P Rates $146M Senior Secured Bank Loan at B+
WESTAFF INC: Seeking Loan Covenant Waivers from Aussie Lenders

*BOOK REVIEW: Lost Prophets -- An Insider's History of the
              Modern Economists

                          *********

ACCRUE SOFTWARE: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Accrue Software, Inc.  
        48634 Milmont Dr.  
        Fremont, CA 94538  

        aka Gauge, Inc.  
        aka T Technologies, Inc.

Bankruptcy Case No.: 03-44749

Chapter 11 Petition Date: August 15, 2003

Court: Northern District of California (Oakland)

Judge: Edward D. Jellen

Debtor's Counsel: Elizabeth Berke-Dreyfuss, Esq.
                  Wendel, Rosen, Black and Dean  
                  1111 Broadway 24th Fl.  
                  P.O. Box 2047  
                  Oakland, CA 94604-2047  
                  (510) 834-6600


ACP: Wants to Continue Employing Ordinary Course Professionals
--------------------------------------------------------------
ACP Holding Company and its debtor-affiliates wants to continue
the employment of professionals they turn to in the ordinary
course of their businesses throughout these chapter 11
proceedings.

The Debtors tell the U.S. Bankruptcy Court for the District of
Delaware that they retain the services of various professionals in
the ordinary course of operating their businesses.  These Ordinary
Course Professionals provide services to the Debtors in a variety
of discrete matters including employee benefits, general
corporate, accounting, auditing, tax, and litigation matters.

The Debtors seek permission to continue to employ the Ordinary
Course Professionals postpetition without the necessity of filing
formal applications for employment and compensation by each
professional.  Due to the number and geographic diversity of the
professionals that are regularly retained by the Debtors, it would
be unwieldy and burdensome on both the Debtors and this Court to
request each such Ordinary Course Professional to apply separately
for approval of its employment and compensation.

The Debtors submit that the continued employment and compensation
of the Ordinary Course Professionals is in the best interests of
the estates, creditors, and other parties in interest. Although
some of the Ordinary Course Professionals may wish to continue to
represent the Debtors on an ongoing basis, others may be unwilling
to do so if they are not paid on a regular basis. If the expertise
and background knowledge of any of these Ordinary Course
Professionals with respect to the particular matters for which
they were responsible prior to the Petition Date are lost, the
Debtors will incur additional and unnecessary expenses, as other
professionals without such background and expertise will have to
be retained.

For the duration of these cases, no Ordinary Course Professional
will be paid more than $7,500 per month for services rendered to
the Debtors without an order of this Court authorizing such higher
amount. Each Ordinary Course Professional will not be paid more
than $40,000 in fees during the Chapter 11 Cases without an order
of this Court authorizing such higher amount.

Neenah Foundry Company, the operating subsidiary of ACP Holding
Company is headquartered in Neenah, Wisconsin.  The Company is in
the business of gray & ductile iron foundries, metal machining to
specifications and steel forging.  The Company filed for chapter
11 protection on August 5, 2003 (Bankr. Del. Case No. 03-12414).  
Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl Young Jones &
Weintraub P.C., and James H.M. Sprayregen, P.C., Esq., and James
W. Kapp III, Esq., at Kirkland & Ellis LLP represent the Debtors
in their restructuring efforts. When the Company filed for
protection from its creditors, it listed $494,046,000 in total
assets and $580,280,000 in total debts.


ACT MANUFACTURING: Massachusetts Court Confirms Liquidating Plan
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Massachusetts
confirmed Act Manufacturing, Inc.'s Plan of Reorganization after
finding that the Plan complies with each of the 13 standards
articulated in Section 1129 of the Bankruptcy Code:

      (1) the Plan complies with the Bankruptcy Code;
      (2) the Debtors have complied with the Bankruptcy Code;
      (3) the Plan was proposed in good faith;
      (4) all plan-related cost and expense payments are
          reasonable;
      (5) the Plan identifies the individuals who will serve as
          officers and directors post-emergence;
      (6) the Plan provides for no rate changes over which
          governmental regulatory commission has jurisdiction;
      (7) creditors receive more under the plan than they would
          in a chapter 7 liquidation;
      (8) all impaired creditors have voted to accept the Plan,
          or, if they voted to reject, then the plan complies
          with the absolute priority rule;
      (9) the Plan provides for full payment of Priority Claims;
     (10) at least one non-insider impaired class voted to
          accept the Plan;
     (11) the Plan is a liquidating plan and confirmation is
          unlikely to be followed by the need for further
          financial reorganization;
     (12) all amounts owed to the Clerk and the U.S. Trustee
          will be paid; and
     (13) the Debtors have no retiree benefits, therefore
          Section 1129(a)(13) is not applicable in this
          proceeding.

Any executory contracts or unexpired leases, which have not
expired by their own terms shall be deemed rejected by the Debtors
on the Effective Date.  All executory contracts and unexpired
leases listed in the Schedule of Assumed and Assumed and Assigned
Executory Contracts and Unexpired Leases, shall be deemed assumed
by the Debtors on the Effective Date.

Act Manufacturing, Inc., is a global provider of value-added
electronic manufacturing services to original equipment
manufacturers in the networking and telecommunications, high-end
computer and industrial and medical equipment markets. The Debtors
filed for chapter 11 protection on December 21, 2001 (Bankr. Mass.
Case No. 01-47641).  Richard E. Mikels, Esq., at Mintz, Levin,
Cohn, Ferris, Glovsky and Popeo represents the Debtors in their
restructuring efforts. When the Company filed for protection from
its creditors, it listed $374,160,000 in total assets and
$231,214,000 in total debts.


AGILENT: Appoints Young K. Sohn to Head Semicon. Products Group
---------------------------------------------------------------
Agilent Technologies Inc. (NYSE: A) has named Young K. Sohn as
senior vice president and general manager of its Semiconductor
Products Group.

Sohn was most recently the chairman and CEO of Oak Technology, a
semiconductor company that provides digital media solutions for
consumer electronics markets. He replaces Dick Chang, who will
work with Agilent chairman, president and CEO, Ned Barnholt, to
identify and pursue new business opportunities for the company.
Sohn will assume his responsibilities in early October.

"I am delighted to welcome Young to Agilent," said Barnholt. "His
skills, experience and depth of knowledge of the semiconductor
industry are greatly valued, and will serve to enhance SPG's
leadership position as a global supplier of advanced semiconductor
solutions."

Prior to joining Oak Technology, Sohn spent seven years with
Quantum Corporation, a data storage solution products manufacturer
based in Milpitas, Calif. At Quantum, Sohn served in a variety of
positions, including president of its Hard Drive Group, vice
president of marketing for the Desktop Division, and president of
the company's Asia-Pacific Region. Sohn also held a number of
positions at Intel Corporation in Santa Clara, Calif., where he
served as director of marketing for Intel's first branded retail
product, and led Intel's PC chipset business unit. Sohn began his
high tech career with Hewlett-Packard as a product engineer in
HP's Avondale, Pa. Instrumentation Division.

"Agilent has a reputation for outstanding technology, top talent
and a great legacy," said Sohn. "I am very pleased to join the
company and look forward to building on SPG's base to develop even
stronger and more innovative technologies, as well as to explore
untapped opportunities."

Sohn, 47, was born in Seoul, South Korea. He received a Bachelor
of Science degree in Electrical Engineering from the University of
Pennsylvania, and a Master's Degree in Management Science at MIT.
He serves on the boards of Cymer Inc. and PLX Technology.

SPG, which had revenues of $1.6 billion in fiscal year 2002, is a
leading supplier of advanced semiconductor components serving
customers in the communications, wireless, computing, storage,
consumer electronics and industrial markets. Products include
fiber optic transceivers, high-speed integrated circuits, radio
frequency and microwave components, infrared transceivers,
application-specific integrated circuits, optical image sensors,
light-emitting diodes and optocouplers, motion control devices,
and navigation sensors used in optical mice.

Agilent Technologies Inc. (NYSE:A) (S&P, BB Corporate Credit and
Senior Note Ratings) is a global technology leader in
communications, electronics, life sciences and chemical analysis.
The company's 32,000 employees serve customers in more than 110
countries. Agilent had net revenue of $6 billion in fiscal year
2002. Information about Agilent is available on the Web at
http://www.agilent.com


ALLEGHENY ENERGY: Terminates Tolling Pact with Las Vegas Cogen.
---------------------------------------------------------------
Allegheny Energy, Inc.'s (NYSE: AYE) subsidiary, Allegheny Energy
Supply Company, LLC, has signed an agreement to terminate its 222-
megawatt tolling agreement with Las Vegas Cogeneration II, a unit
of Black Hills Corporation (NYSE: BKH).

Paul J. Evanson, Chairman, President, and Chief Executive Officer
of Allegheny Energy, said, "With the signing of this agreement, we
have substantially achieved our goal of exiting the Western energy
markets, thereby significantly reducing our financial exposure to
energy trading. We can now refocus fully on optimizing our core
generation assets."

Under this agreement, Allegheny will make a $114-million payment
to Las Vegas Cogeneration II after closing the previously
announced sale of its long-term energy supply contract with the
California Department of Water Resources (CDWR) and obtaining the
consent of a majority of its lenders. Allegheny's payments under
the tolling agreement will continue until the tolling agreement is
terminated upon payment of the $114 million.

Allegheny Energy Supply entered into the 15-year tolling agreement
with Las Vegas Cogeneration II in May 2001. The 222-MW natural
gas-fired generating facility went into commercial service in
January 2003.

With headquarters in Hagerstown, Md., Allegheny Energy is an
integrated energy company with a balanced portfolio of businesses,
including Allegheny Energy Supply, which owns and operates
electric generating facilities and supplies energy and energy-
related commodities, and Allegheny Power, which delivers low-cost,
reliable electric and natural gas service to about three million
people in Maryland, Ohio, Pennsylvania, Virginia, and West
Virginia. More information about the Company is available at
http://www.alleghenyenergy.com

As reported in Troubled Company Reporter's August 12, 2003
edition, Fitch Ratings assigned a 'BB-' rating to Allegheny Energy
Inc.'s $300 million 11-7/8% convertible notes due 2008 and
Allegheny Capital Trust I's $300 million preferred securities. The
trust was formed to hold and pass through to the holders of the
preferred securities all of the economics and legal rights
associated with the notes and warrants issued by AYE to purchase
common stock of AYE.


ALLEGHENY ENERGY: Black Hills Confirms Buyout of Las Vegas Cogen
----------------------------------------------------------------
Black Hills Corporation (NYSE: BKH) announced a definitive
agreement to terminate an existing contract between its
subsidiary, Las Vegas Cogeneration II, LLC, and Allegheny Energy
Supply Company, LLC, a subsidiary of Allegheny Energy, Inc. (NYSE:
AYE).

Under the termination agreement, Allegheny Energy Supply will pay
$114 million to Las Vegas Cogeneration II. The Company is
currently evaluating the accounting treatment and earnings impacts
resulting from the contract termination. The transaction is
expected to close by the end of 2003, and is subject to the
closing of Allegheny Energy Supply's sale of a contract with the
California Department of Water Resources, and completion of other
factors customary to contract terminations. Proceeds from the
termination agreement will be used to reduce debt or for other
corporate purposes.

The Company also announced that discussions are progressing with
other interested parties for new long-term contract arrangements
for the capacity and energy of Las Vegas Cogeneration II.

Daniel P. Landguth, Chairman and CEO of Black Hills Corporation,
said, "We are pleased to announce a positive resolution to issues
surrounding our Las Vegas facility. We believe this contract
buyout, when completed, will further enhance our financial
position. This power plant possesses strong operating performance
in a superb location, and we hope to enter into a new long-term
contract yet this year."

Black Hills Corporation -- http://www.blackhillscorp.com-- is a  
diverse energy and communications company. Black Hills Energy, our
non-regulated energy business group, generates electricity,
produces natural gas, oil and coal and markets energy; Black Hills
Power is our electric utility serving western South Dakota,
northeastern Wyoming and southeastern Montana; and Black Hills
FiberCom, a broadband communications company, offers bundled
telephone, high speed Internet and cable entertainment services.

Allegheny Energy Inc. is a registered utility holding company,
which owns three regulated utilities, Monongahela Power, Potomac
Edison and West Penn Power and two non-utility subsidiaries. The
utilities deliver electric and gas service to 1.5 million
customers in parts of Maryland, Ohio, Pennsylvania, Virginia, and
West Virginia and 230,000 customers in West Virginia,
respectively. AYE's non-utility subsidiaries consist of Allegheny
Energy Supply Co. LLC, which develops, acquires, owns and operates
generating plants and is a marketer of electricity and other
energy products and Allegheny Ventures which is involved in
telecommunications and energy related projects.

As reported in Troubled Company Reporter's August 12, 2003
edition, Fitch Ratings assigned a 'BB-' rating to Allegheny Energy
Inc.'s $300 million 11-7/8% convertible notes due 2008 and
Allegheny Capital Trust I's $300 million preferred securities. The
trust was formed to hold and pass through to the holders of the
preferred securities all of the economics and legal rights
associated with the notes and warrants issued by AYE to purchase
common stock of AYE.


ALLIANCE GAMING: Proposed $375MM Sr. Secured Facility Rated BB-
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' rating to
Alliance Gaming Corp's proposed $375 million senior secured credit
facility, composed of a $100 million reducing five-year revolver
and a $275 million six-year term loan.
     
Most of the proceeds from this offering will be used to refinance
amounts outstanding under its $190 million term loan and 10% $150
million subordinated notes due 2007, with the remaining proceeds
to be used to pay fees and expenses.
     
"The ratings on the existing term loan and subordinated notes
subsequently will be withdrawn. Standard & Poor's also affirmed
its 'BB-' corporate credit rating on Alliance," said Standard &
Poor's credit analayst Peggy Hwan.
     
The outlook is stable. Pro forma for this transaction and assuming
cash proceeds (net of taxes) from the sale of both the route
business and Bally Wulff to be used for debt reduction, Standard &
Poor's expects that total debt outstanding at June 30, 2003 would
have been around $250 million.
     
The ratings for Las Vegas, Nev.-based Alliance Gaming Corp.,
reflect the company's number-two position in the North American
gaming equipment market, and its growing base of successful gaming
devices and game monitoring systems. This is offset by the
company's small size, and the existence of a much larger and well-
established competitor, International Game Technology
     
Bally's Gaming and Systems has benefited from the introduction of
new technology and new game themes during the last few years. Its
"EVO" game platform was first introduced in mid-2000, and has
improved the division's ability to create higher quality games,
and to roll them out more rapidly. This has contributed to an
increase in both the number of game devices sold and the size of
the installed base of recurring revenue machines. As a result,
Bally's EBITDA rose by 73% year over year for the fiscal 2003
period ended June 30, 2003, primarily as a result of an increase
in new unit sales associated with the opening of certain casinos,
as well as a higher average new unit selling price.


AMERCO: Has Until Dec. 17, 2003 to Make Lease-Related Decisions
---------------------------------------------------------------
AMERCO obtained from the Court an extension of the deadline for
it to decide whether to assume, assume and assign, or reject an
unexpired non-residential real property leases until December 17,
2003. (AMERCO Bankruptcy News, Issue No. 5; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


AMERICANA PUBLISHING: June Net Capital Deficit Stands at $2.5MM
---------------------------------------------------------------
Americana Publishing, Inc. (OTC Bulletin Board: APBH) reported
record operating results for the second quarter and six-month
period ended June 30, 2003.

Revenues for the quarter increased by 500% from the same period
last year. Revenues for the six months ended June 30, 2003
increased by more than 400%.

The Company also reported positive cash flow for both the quarter
and the six-month period ended June 30, 2003.

The Company also reported that its interest expenses have been
reduced by 99 percent.

At June 30, 2003, the Company's balance sheet shows a working
capital deficit of close to $3 million, and a total shareholders'
equity deficit of about $2.5 million.

"Our recent financial results are particularly gratifying," said
George Lovato, Jr., Americana Publishing, Inc. chairman and chief
executive officer. "The dramatic increase in sales is testimony to
both the growing popularity of the audio book category and the
excellent response to our ever-expanding list of titles.  We are a
multi-media company in a very hot industry that benefits almost
daily from advances in technology.

"We are truly getting our financial house in order with increased
sales, positive cash flow and significantly reduced interest
costs," Lovato said. "We have initiatives in place to expand and
diversify revenues and we expect to have our newly established
subsidiary, Americana Entertainment, Ltd. to be up and running
within the next quarter. In addition, we recently announced the
disposal of a non-performing subsidiary that will eliminate $2.1
million in debt from our balance sheet.

"We anticipate continuing at similar run rate for the third
quarter," Lovato added.  "However, if some of our test markets and
initiatives fall into place we could see another dramatic spike in
revenues."

Americana Publishing, Inc. is an up and coming leader in the
nearly $2 billion audio books industry.  The Company currently has
approximately 450 book titles and should have well over 500 by
year-end, which it sells through the Internet, retail stores,
libraries as well as major truck stop distributors.  The Company
also has a growing print book division and just launched a film
production and distribution division, Americana Entertainment,
Ltd.

Americana Publishing, Inc. is a vertically integrated multimedia
publishing company whose primary business is publishing and
selling audio books, print books and electronic books in a variety
of genres.  Sales of its products are conducted through the
Internet as well as a distribution network of more than 35,000,
retail stores, libraries and truck stops.  According to the Audio
Publishers Association, annual sales of audio books are nearly
$2 billion.  Currently 42 million Americans listen to audio books
and 58 percent of that group listen to more than 2 per month.  The
median income of listeners is $54,900 while the median age of male
listeners is 41.9 and female listeners is 44.2 years.
                                    

AQUILA INC: Sells about 550,000 Shares to Pay Tax Obligations
-------------------------------------------------------------
Aquila, Inc.'s (NYSE:ILA) chairman, president and chief executive
officer, Richard C. Green, Jr., has filed documents with the
Securities and Exchange Commission that formally report the sale
of 551,018 shares of company stock.

Proceeds from the sale of the stock will be used to pay personal
federal income taxes due as the restrictions lapse on Aquila stock
received over the past several years. The majority of Green's
compensation during these years has been in the form of restricted
company stock.

"The sale of this stock is driven entirely by the need to pay
personal taxes and is not an indication of any lessening of
commitment toward executing our company's recovery plans," Green
said. "I remain as focused as ever on building a new future for
the company, and I especially remain committed to our employees
who are working hard to make that future happen."

This is the first time since 1999 that Green has sold company
stock. As a result of the sale, Green now owns, or beneficially
owns, 1.2 million shares of Aquila stock. A large number of these
shares were accumulated over the past six years when Green chose
to receive a major portion of his compensation in restricted
stock.

Securities and Exchange Commission rules prohibit any executive
transactions in company stock while in possession of material
inside information. This information includes earnings details.
Company policy requires that executives wait several days after
the announcement of quarterly results before initiating any stock
transactions. Aquila announced second quarter results on August
12, 2003.

Based in Kansas City, Mo., Aquila (S&P, B+ Credit Facility Rating,
Negative) operates electricity and natural gas distribution
networks serving customers in Missouri, Kansas, Iowa, Minnesota,
Colorado, Michigan and Nebraska, as well as in Canada and the
United Kingdom. The company also owns and operates power
generation assets. More information is available at
http://www.aquila.com


ARDENT HEALTH: Completes $225MM Financing via Private Placement
---------------------------------------------------------------
Ardent Health Services has completed the private placement of $225
million of Senior Subordinated Notes at 10 percent interest, due
2013.  Proceeds from the sale of the notes will be used primarily
to repay existing indebtedness and for general corporate purposes.

The notes will mature on August 15, 2013, and will pay interest
semi-annually in cash in arrears on February 15 and August 15,
starting on February 15, 2004.  The company may redeem the notes
in whole or in part any time on or after August 15, 2008.  In
addition, the company may redeem up to 35 percent of the notes
before August 15, 2006, with net cash proceeds from certain equity
offerings.

In connection with the sale of the notes, the company amended its
credit facility.  The amendment provides for revisions to certain
financial covenants, including increasing the company's credit
line from $100 million to $125 million.

The notes have not been registered under the Securities Act of
1933, as amended, and may not be offered or sold within the United
States or to, or for the account or benefit of, U.S. persons
except pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act.  
The notes are being offered only to qualified institutional buyers
as defined in Rule 144A under the Securities Act and outside of
the United States to non-U.S. persons in compliance with
Regulations S under the Securities Act.

Ardent Health Services (S&P, B+ Corporate Credit Rating, Negative)
is a provider of health care services to communities throughout
the United States.  Ardent currently owns 27 hospitals in 12
states, providing a full range of medical/surgical, psychiatric
and substance abuse services to patients ranging from children to
adults.


ATCHISON CASTING: Turns to Alvarez & Marsal for Financial Advice
----------------------------------------------------------------
Atchison Casting Corporation and its debtor-affiliates want
approval from the U.S. Bankruptcy Court for the Western District
of Missouri to employ Alvarez & Marsal, Inc., as their Financial
Consultants as the company restructures under chapter 11.  

The Debtors report that Alvarez has extensive experience providing
advisory services to financially-distressed companies. Alvarez has
become familiar with the Debtors' business, properties, capital
structure, and financial condition, and is well suited to:

     i. assist the Company in cooperation with the Chief
        Executive Officer of ACC in performing a financial
        review of the Company, including but not limited to a
        review and assessment of financial information that has
        been, and that will be, provided by the Company to its
        creditors, including without limitation its short and
        long-term projected cash flows;

    ii. assist the CEO in developing for the review by the Board
        of Directors of ACC pre and post-bankruptcy filing
        strategies and reporting requirements during the
        bankruptcy, including but not limited to the plan of
        reorganization;

   iii. serve, under the Company's direction, as the principal
        contact with the Company's creditors with respect to the
        Company's financial and operational matters and the
        negotiation of a plan of reorganization; and

    iv. perform such other services as requested or directed by
        the CEO and the Board and agreed to Alvarez & Marsal.

William S. Romney a Senior Director of Alvarez & Marsal, will be
responsible for the overall engagement and will be assisted by
other firm personnel.  The Alvarez & Marsal professional hourly
rates are:

          Managing Director      $475 per hour
          Director               $430 per hour
          Associate              $350 per hour
          Analyst                $225 per hour

Atchison Casting Corporation, headquartered in St. Joseph,
Missouri, together with its affiliates, produce iron, steel and
non-ferrous castings and machining for a wide variety of
equipment, capital goods and consumer markets. The Company filed
for chapter 11 protection on August 4, 2003 (Bankr. W.D. MO. Case
No. 03-50965).  Mark G. Stingley, Esq., and Cassandra L. Writz,
Esq., at Bryan Cave LLP represent the Debtors in their
restructuring efforts.  When the Company filed for protection from
its creditors, it listed $136,750,000 in total assets and
$96,846,000 in total debts.


BIOSPECIFICS: Limited Liquidity Raise Going Concern Uncertainty
---------------------------------------------------------------
Biospecifics Technology Company's consolidated financial
statements have been prepared assuming that the Company will
continue as a going concern, which contemplates the realization of
assets and the satisfaction of liabilities in the normal course of
business.  The Company has incurred significant operating losses
since the period of Curacao facility renovation and currently has
limited liquidity. These factors raise substantial doubt about the
Company's ability to continue as a going concern.

As of the date of this report, the Company has limited cash
resources available to fund its operations. Over the past few
months, the Company has been able to fund operations by (1)
borrowings: $100,000 from an unaffiliated individual, an aggregate
of $500,000 from April through the first half of June 2003,
advanced to the Company by a principal of Bio Partners LP, a
private investment group and unrelated third party, and net
$890,000 from Bio Partners on June 19, 2003,  (after the payment
of loan expenses and taking into account the aggregate $500,000
previously advanced to the Company by a principal), (2) receiving
early payment of royalties from Abbott Laboratories, the Company's
major customer, in May 2003 earned from distribution of Santyl
Ointment from a supply that will be depleted in August 2003, (3)
the Chairman's deferring salary of approximately $100,000 during
the three months ended June 30, 2003, (4) the Chairman's repaying
$153,946 from January 2003 through June 30, 2003, and in July 2003
repaying an additional $307,000 obtained by his refinancing the
mortgage on the administrative headquarters in Lynbrook, New York,
which is owned by his affiliate and leased to the Company, and (5)
deferring or making partial payments to creditors.

On June 19, 2003, the Company entered into a financing transaction
with Bio Partners LP, a private investor group, pursuant to which
the Company sold to Bio Partners in a private placement (i) a
$1.575 million convertible note, issued at face value, and (ii)
295,312 restricted shares of Company common stock, issued at par
value, or $.001 per share. The net proceeds to the Company were
approximately $890,000, after the payment of loan expenses and
taking into account the aggregate $500,000 that was previously
advanced to the Company by a principal of Bio Partners. Based on
operating projections made in January 2003 and updated through
July 2003, the Company projects that these funds will enable it to
continue operations at least to December 31, 2003.

These projections assume or assumed that, among other things:

- the Company obtain FDA approval of the Curacao facility, which
  it did in July 2003 the Company can timely sell to Abbott
  inventory manufactured prior to FDA approval of the Curacao
  facility, its primary manufacturing facility;

- the Chairman repay to the Company $325,000 of the amount he and
  his affiliate owe the Company by the end of July 2003, which he
  did in July 2003 in the amount of $307,000; and

- the Company receives a tax refund of approximately $412,000 in
  September 2003, on a refund filing made in July 2003.

If any of the remaining assumptions on which the projections are
based do not occur, the Company may not be able to fund operations
past the next several months. In addition, it cannot be assured
that the Company will be able to obtain any additional financing
on acceptable terms, if at all. The Company is attempting to
license its injectable collagenase product under development. The
projections do not assume such a transaction.


BOOTS & COOTS: Provides Summary of Annual Shareholders Meeting  
--------------------------------------------------------------
Boots & Coots International Well Control, Inc. (Amex: WEL),
released a summary of its Annual Shareholders Meeting, which was
held in Houston, Texas Tuesday, August 19, 2003 at 10 a.m.  The
summary will be available on Boots & Coots' Web site and Gross
Capital, Inc.'s Web site.  To view the summary, please access
the following links:

     http://www.bootsandcoots.com/Press_Releases/2003_08_20.htm

     http://www.grosscapital.com/newsWEL_summary.htm

Additionally, Proposal 1, to elect one Class I director for a term
of one year, one Class II director for a term of two years and one
Class III director to serve for a term of three years or until
their respective successors are elected and qualified were
approved by a majority of shareholder votes. Proposal 2, to
approve an amendment to Boots & Coots International Well Control,
Inc.'s Amended and Restated Certificate of Incorporation effecting
a one-for-four reverse split of the Company's common stock was
also approved by a majority of shareholder votes.   A definitive
public announcement as to when it will occur will be made shortly.

Boots & Coots International Well Control, Inc., Houston, Texas, is
a global emergency response company that specializes, through its
Well Control unit, as an integrated, full-service, emergency-
response company with the in-house ability to provide its expanded
full-service prevention and response capabilities to the global
needs of the oil and gas and petrochemical industries, including,
but not limited to, oil and gas well blowouts and well fires as
well as providing a complete menu of non-critical well control
services.  Additionally, Boots & Coots WELLSURE(R) program offers
oil and gas exploration and production companies, through retail
insurance brokers, a combination of traditional well control and
blowout insurance with post-event response as well as preventative
services.

As reported in Troubled Company Reporter's July 4, 2003 edition,
Boots & Coots International concluded negotiations with Prudential
Insurance Company of America to restructure its obligations that
will cure its current loan defaults. As previously disclosed, the
Company has been in default under its subordinated note agreement
with Prudential since March 31, 2002.

As part of the agreement, Boots & Coots agreed to issue
approximately $2.4 million of new subordinated notes to Prudential
representing past due interest, with the option through
December 31, 2003, to pay in kind the interest on the subordinated
notes accruing through that period. The Company further agreed to
accelerate the optional conversion date for approximately 33% of
the Company's outstanding Series E Preferred Stock, all of which
are held by Prudential, to January 1, 2004, from the original
optional conversion date of December 27, 2005.

In exchange, Prudential agreed to waive the Company's past
covenant defaults that required it to maintain certain debt to
earnings ratios, and to waive compliance with all such covenants
through December 31, 2003. Prudential also agreed to defer the
requirement that the Company pay cash dividends on its Series E
and G preferred stock until March 31, 2004.

As a result of this debt restructuring initiative, the Company is
now current in its debt obligations to Prudential and is in full
compliance with all loan covenants related to Prudential.


BRM HOLDINGS: Asks Court to Enter Final Decree Closing the Cases
----------------------------------------------------------------
The USOP Liquidating LLC, successor in interest to BRM Holdings,
Inc., formerly known as US Office Products Company, seeks a final
decree closing the Chapter 11 cases of each of the Debtors except
BRM, nunc pro tunc to March 31, 2002.

Pursuant to the December 28, 2001 confirmed Plan, all remaining
assets, rights, and liabilities of the Debtors, including all
claims and causes of action, were transferred to USOP LLC as of
the Effective Date.

Under section 350(a) of the Bankruptcy Code and Rule 3022 of the
Federal Rules of Bankruptcy Procedure, after an estate is fully
administered and the court has discharged the trustee, the court
on its own motion or on motion of a party in interest shall grant
a final decree closing the relevant chapter 11 case.

According to the 1991 Advisory Committee Note to Bankruptcy Rule
3022, factors that the court should consider in determining
whether the estate has been fully administered include:

     1) whether the order confirming the plan has become final;

     2) whether deposits required by the plan have been
        distributed;

     3) whether the property proposed by the plan to be
        transferred has been transferred;

     4) whether the debtor or the successor of the debtor under
        the plan has assumed the business or the management of
        the property dealt with by the plan;

     5) whether payments under the plan have commenced, and

     6) whether all motions, contested matters, and adversary
        proceedings have been finally resolved.

USOP LLC asserts that each of these factors had been satisfied
with respect to the Closing Cases as of no later than March 31,
2002:

     a) the Confirmation Order had become final and the
        Effective Date had occurred;

     b) the Plan did not require any deposits;

     c) the property required to be transferred tinder the Plan
        had been transferred to USOP LLC; and

     d) Plan payments had commenced.

Accordingly, the Closing Cases had been substantially consummated
as of the Closing Date.

In addition, USOP LLC has paid or will promptly pay all required
fees due under 28 U.S.C. 1930 with respect to the Closing Cases.

BRM Holdings, Inc., one of the world's leading suppliers of office
products and business services to corporate customers, filed for
chapter 11 protection on March 5, 2001 in the US Bankruptcy Court
for the District of Delaware. Brendan Linehan Shannon, Esq., at
Young Conaway Stargatt & Taylor, LLP represents USOP Liquidating
LLC in these proceedings.


CABLETEL COMMS: Default on Note Possible if Negotiation Fails
-------------------------------------------------------------
Cabletel Communications Corp. (AMEX: TTV; TSX: TTV), a leading
distributor of broadband equipment to the Canadian television and
telecommunications industries, announced results for the second
quarter and six month periods ended June 30, 2003 (all figures are
in Canadian dollars).

Greg Walling, President and CEO of Cabletel, stated, "The slowdown
in the cable industry has definitely affected our business,
however, we believe the restructuring initiatives outlined below
are a major step in repositioning the Company to return to
profitability in the future."

Second Quarter Highlights:

- Second quarter sales fell by $6,183,409 to $8,776,970 compared
  to $14,960,379 for the same quarter last year.

- Second quarter gross margin percentage was 8% vs. 17.8% for the
  same quarter last year and gross profit down 73.6% compared to
  the second quarter of last year.

- Second quarter selling, general and administrative expenses were
  $174,146 down 7.7% as compared to the same quarter last year.

- Second quarter loss of $2,544,966 includes special charge of
  $280,000, write down of equipment of $400,000, write off of
  goodwill amounting to $198,606, and an increase in the Company's
  reserve for inventory obsolescence amounting to $641,000 that
  was expensed through cost of sales. For the comparable period
  last year the Company had a loss of $674,154 which included a
  write-off of other assets in connection with Allied in the
  amount of $604,809 and a loss on settlement of debt in the
  amount of $164,000

- Diluted loss per share for the second quarter was 36 cents per
  share vs. a loss of 9 cents per share for the same quarter last
  year.

- Second quarter net sales in the Manufacturing segment increased
  by $615,611 or 37% compared to the same quarter last year.

                       Consolidated Results

For the three months ended June 30, 2003, the Company incurred a
net loss of $2,544,966 compared to a net loss of $674,154 for the
three months ended June 30, 2002. Basic and fully diluted loss per
share was $0.36 for the three months ended June 30, 2003 compared
to basic and fully diluted loss per share of $0.09 for the three
months ended June 30, 2002. Inclusive of the previously mentioned
write offs, for the six months ended June 30, 2003, net loss was
$2,792,371 compared to a net loss of $613,203 for the six months
ended June, 30, 2002. Basic and fully diluted loss per share was
$0.39 for the six months ended June 30, 2003 compared to basic and
fully diluted loss per share of $0.09 for the six months ended
June 30, 2002.

Consolidated net sales for the three months ended June 30, 2003
decreased by $6,183,409 or 41% to $8,776,970 compared to
consolidated net sales of $14,960,379 for the three months ended
June 30, 2002. Consolidated net sales of $19,895,317 for the six
months ended June 30, 2003 decreased by $8,248,748 or 29% compared
to consolidated net sales of $28,144,065 for the six months ended
June 30, 2002. The primary reason for the decrease for the three
and six month periods ending June 30, 2003 is attributable to the
Company's Distribution segment where financial and market
conditions that impacted growth in the cable and satellite
industry resulted in reduced capital spending within the industry.
There is a risk that the softening will continue within the
Distribution segment with respect to reduced capital expenditures
among the major cable companies throughout the remainder of the
year. This was positively offset by increased sales in the
Manufacturing segment of which sales increased by 37% for the
quarter and 40% for the six month period ending June 30, 2003 when
compared to the prior year periods. Virtually all of the
Manufacturing segments sales were exported to foreign countries,
primarily to the United States.

Gross profit for the three months ended June 30, 2003 of $703,460
decreased by $1,959,532 or 74% compared to gross profit of
$2,662,992 for the three months ended June 30, 2002. Gross margin
for the three months ended June 30, 2003 was 8% compared to 17.8%
for the three months ended June 30, 2002. Gross profit for the six
months ended June 30, 2003 of $2,702,154 decreased by $2,408,852
or 47% compared to gross profit of $5,111,006 for the six months
ended June 30, 2002. Gross margin for the six months ended June
30, 2003 was 13.6% compared to 18% for the six months ended June
30, 2002. The primary reason for the decrease in gross margin for
the three and six months ended June 30, 2003 is due to the Company
increasing it's reserve for inventory obsolescence amounting to
approximately $641,000 that was expensed through cost of sales. In
addition, a slowdown in the industry resulted in a more
competitive environment. The Manufacturing segment experienced
production shut downs during periods when tooling changes were
required as well as when demand for product was soft.

Selling, general and administrative expenses for the three months
ended June 30, 2003 decreased $174,146 or 8% to $2,074,136
compared to $2,248,282 for the three months ended June 30, 2002.
As a percentage of sales, selling, general and administrative
expenses for the three months ended June 30, 2003 were 23.6%
compared to 14% for the three months ended June 30, 2002. Selling,
general and administrative expenses for the six months ended June
30, 2003 decreased $397,863 or 9% to $1,447,963 compared to
$3,923,037 for the six months ended June 30, 2002. As a percentage
of sales, selling, general and administrative expenses for the six
months ended June 30, 2003 were 20% compared to 16.5% for the six
months ended June 30, 2002. The Company has made a conscious
effort to reduce certain costs in an attempt to return the Company
to profitability. Such cost cutting measures included reductions
in the Company's labor force as well as reductions in marketing
costs.

Interest expense decreased $13,968 to $241,867 for the three
months ended June 30, 2003 compared to $255,835 for the three
months ended June 30, 2002. Interest expense on bank indebtedness
for the three months ended June 30, 2003 decreased by $15,210 due
to lower borrowings under the Company's credit facility, and
interest expense on long-term debt increased by $1,242. For the
six months ended June 30, 2003, interest expense increased by
$72,707 to $493,751 compared to $421,044 for the six months ended
June 30, 2002. Interest on bank indebtedness decreased by $1,928,
and interest on long-term debt increased by $74,635. The decrease
in interest expense on bank indebtedness reflects lower levels of
borrowings of the Company's line of credit during the first six
months of the year while interest expense on long-term debt was
incurred on a long-term note from the renegotiation of credit
terms with a major supplier during the second quarter of 2002.

                      Impairment Charges

For the three and six months ended June 30, 2003, the Company
wrote down manufacturing equipment amounting to $400,000. The
Company re-assessed the carrying value of its equipment and
determined that there was an impairment in value and accordingly,
took a write down based on the net realizable value of the
equipment.

For the three and six months ended June 30, 2003, the Company
recorded a write off of goodwill amounting to $198,606 in
connection with its acquisition of Allied. The Company assessed
the carrying value of the goodwill and determined that it had been
impaired due to Allied's poor performance and continued
uncertainty in the telecommunications industry.

                        Special Charges

For the three and six months ended June 30, 2003, Cabletel
recorded special charges of $280,000 related to termination
expenses of approximately 25% of Cabletel's workforce. As of June
30, 2003, the unpaid balance of these charges included in accrued
liabilities was $280,000. For the three and six months ended June
30, 2003 the Company had not paid out any funds relating to the
special charge.

                     Distribution Segment

Net sales of $6,161,789 in the Distribution segment for the three
months ended June 30, 2003 reflects a decrease of $6,744,759 or
52% compared to $12,906,548 for the three months ended June 30,
2002. Net sales of $13,997,082 in the Distribution segment for the
six months ended June 30, 2003 reflects a decrease of $9,847,021
or 41% compared to $23,844,103 for the six months ended June 30,
2002. The primary reason for the decrease for the three and six
month periods ending June 30, 2003 in the Distribution segment is
attributable to financial and market conditions that impacted
growth in the cable, and satellite industry resulting in reduced
capital spending within the industry during the year.

                    Manufacturing Segment

Net sales in the Manufacturing segment of $2,262,878 for the three
months ended June 30, 2003, reflects an increase of $615,611 or
37% compared to $1,647,267 for the three months ended June 30,
2002. Net sales in the Manufacturing segment of $4,778,705 for the
six months ended June 30, 2003 reflects an increase of $1,376,215
or 40% compared to $3,402,490 for the six months ended June 30,
2002. The increase is primarily due to an increase in sales to
foreign countries. For the three months ended June 30, 2003 sales
to foreign countries, primarily the United States were $1,470,408
compared to $1,515,299 for the three months ended June 30, 2002.
Sales to foreign countries for the six months ended June 30, 2003
were $3,549,670 compared to $3,050,103 for the six months ended
June 30, 2002.

                      Technology Segment

Net sales of $1,144,773 in the Technology segment for the three
months ended June 30, 2003 reflects an increase of $606,231 or
113% compared to $538,542 for the three months ended June 30,
2002. Net sales of $2,348,565 in the Technology segment for the
six months ended June 30, 2003 reflects an increase of $1,098,706
or 88% compared to $1,249,859 for the six months ended June 30,
2002. The increase is primarily due to the acquisition and
consolidation of Allied, representing approximately $432,000 in
sales for the three months ended June 30, 2003 and $896,000 for
the six months ending June 30, 2003.

                  Restructuring Initiatives

The Company has undertaken a restructuring plan to seek to reduce
operating costs and total indebtedness. The restructuring plan is
expected to include the following key components:

- A reduction in the size of its workforce by approximately 25%.

- Explore the sale of non-core assets.

- A reduction of occupancy costs through the consolidation of its
  operation into fewer facilities.

- Efforts to renegotiate terms with key suppliers.

The Company has commenced these efforts and believes that, if
successful, they should result in cost savings and increased
working capital. However, no assurances can be given that the
restructuring plan can be successfully completed.

               Financial Liquidity, Capital Resources
                    and Bank Facility Covenants

Historically the Company has funded its operations through working
capital. At June 30, 2003, the Company's current assets exceeded
its current liabilities by $996,918. However, during the three and
six months ended June 30, 2003, the liquidation of inventory
slowed from prior experience, primarily as a result of the
slowdown in the industry. As a result the Company has been slower
than usual in meeting vendor payment terms. Should this trend
continue it may present a long-term liquidity concern for the
Company.

On May 16, 2002, Cabletel entered into a Revolving Credit Facility
Agreement with LaSalle Business Credit, a division of ABN AMBRO
BANK N.V., Canada Branch for a three year committed fifteen
million Canadian dollars (CAD$15,000,000), or its United States
dollar equivalent.

The facility contains certain customary covenants. As of June 30,
2003, as a result of a variation from the required minimum
adjusted net worth, interest coverage ratio and debt service
ratio, the Company had a technical violation of the applicable
covenants. The Company is working with its lender to resolve the
matter and expects to receive either a waiver or amendment to the
agreement shortly. There can be no assurance that the Company will
be successful in obtaining either a waiver or amendment. In the
event that the Company is unable to obtain such waiver or
amendment it could adversely affect the Company.

As of November 1, 2002, the Company began consolidating the
results of Allied, as a result of the Company's ability to convert
it's convertible debenture into 100% ownership of all issued and
outstanding common shares of Allied for a nominal consideration.
Subsequently, on May 9, 2003, Cabletel exercised its option and
acquired all the outstanding shares of Allied. Allied is currently
in negotiations with its senior bank lender with regards to an
extension of its senior bank facility beyond its current maturity
date. If Allied is unable to obtain such an extension, this could
adversely affect the consolidated results of the Company as the
Company would be required to write off its investment and
receivables due from goods sold in the ordinary course of business
amounting to approximately $250,000.

In connection with its restructuring plan, the Company announced
that it is in the process of seeking to renegotiate the payment
terms of its US $2.2 million senior subordinated promissory note
issued to one of its major suppliers. As a result, it has obtained
the consent of the payee to pay half of each of the full US
$120,000 installments due under the note on each of May 31, June
30 and July 31, 2003. The promissory note, which was issued in May
2002 as part of the conversion of US $2.2 million in outstanding
payables owed by the Company to a major supplier, bears interest
at the rate of 12% per annum and called for repayment in monthly
installments of US $60,000 through April 2003 and US $120,000
thereafter through April 30, 2004. Because of the continued
weakness in the Canadian television and telecommunication
industries, the Company has been in discussions with the payee of
the note regarding a restructuring which would reduce the monthly
payments below the required US $120,000.

Although discussions with the payee have commenced, to date the
Company and the payee have not agreed upon the terms of a
restructuring. Unless an agreement is reached by September 15,
2003, the Company will be required to pay the full US $120,000
installment due on August 31, 2003, plus the amount of the
Company's total underpayment of US $180,000 with respect to the
May 31, June 30 and July 31, 2003 installments. Unless an
agreement is reached, the Company does not expect to be in a
position to make those payments. If the Company is unable or
otherwise fails to make those payments in full it would constitute
a default of the terms of the note, which is unsecured and
subordinated to the rights of the senior bank lenders under the
Company's senior credit facility. The Company has been
coordinating its efforts to renegotiate the terms of the note with
its senior bank lenders, who have been supportive of the Company
in that regard. While the Company expects that it can conclude a
renegotiation of the payment terms of note on terms mutually
satisfactory to the Company, the payee and the bank, no assurances
can be given that such agreement can be reached. If no agreement
is reached, the Company may not be in a position to make all of
the required payments, an event that could permit the payee to
call an event of default under the note and have a material
adverse impact on the Company and its business.

The Company's public filings are available at
http://www.sec.gov/edgar.shtmlor http://www.sedar.com


CELL ROBOTICS: Needs New Financing to Repay Current Indebtedness
----------------------------------------------------------------
Since inception, Cell Robotics International Inc., has incurred
operating losses and other equity charges which have resulted in
an accumulated deficit of $31,069,945 at June 30, 2003 and
operations using net cash of $596,995 in the first half of 2003.

The Company's ability to improve cash flow and ultimately achieve
profitability will depend on its ability to significantly increase
sales. Accordingly, the Company is manufacturing and marketing the
Lasette, a sophisticated laser-based medical device, that
leverages the Company's existing base of technology. The Company
believes the markets for this product are broader than that of the
scientific research instruments market and, as such, offer a
greater opportunity to significantly increase sales. In addition,
the Company is pursuing development and marketing partners for
some of its new medical products. If obtained, the Company
believes these partnerships may enhance the Company's ability to
rapidly ramp-up its marketing and distribution strategy, and
possibly offset the products' development costs.

Although the Company has begun manufacturing and marketing the
Lasette and the Company continues to market its scientific
research instrument line, it does not anticipate achieving
profitable operations until after 2003. As a result, the Company
expects that additional operating funds will be required under its
September 2002 promissory note or under alternative financing
sources and that its accumulated deficit will increase in the
foreseeable future.

Since inception, to provide working capital for product
development and marketing activities, the Company has relied
principally upon the proceeds of both debt and equity financings
and has not been able to generate sufficient cash from operations.  
As a consequence, it must seek additional financing to fund
ongoing operations.

As of June 30, 2003, the Company's net working capital was a
deficit of $800,923 and its total cash and cash equivalents was
$59,340. Cell Robotics expects to experience operating losses and
negative cash flow for the foreseeable future. Therefore, it does
not have sufficient cash to sustain those operating losses without
additional financing. The Company presently needs financing to
repay its current indebtedness, including payment of its notes in
the aggregate principal amount of approximately $339,000 of which
approximately $204,000 is currently due. In addition to debt
service requirements, the Company will require cash to fund its
operations. Based on current operations it is estimated that cash
needs of at least approximately $200,000 each month for the
foreseeable future will be needed, and will become a total of
approximately $1,200,000 from June 30 through December 31, 2003.


CHAMPIONLYTE HOLDINGS: Red Ink Continued to Flow in 2nd Quarter
---------------------------------------------------------------
ChampionLyte Holdings, Inc., formally ChampionLyte Products, Inc.,
(OTC Bulletin Board: CPLY) reported operating results for the
second quarter ended June 30, 2003.

As the result of ongoing, strategic restructuring during the
second quarter the Company produced nominal revenues during that
period. However, per share losses were just $.04 compared to $.13
per share in same quarter last year. The Company said that nearly
90 percent of the net loss was the result of non-operating
expenses for the issuance of shares of stock to settle debt or to
engage firms and consultants to execute its business plan.

"We continue to make progress in our efforts to resuscitate the
Company which just a few months ago was on the brink of collapse,"
said ChampionLyte Holdings, Inc. President, David Goldberg. "We've
slashed costs, increased efficiencies at virtually every level of
operations while producing a product that is gaining wide
acceptance at targeted points of distribution.

"We're particularly pleased that we have reclaimed our Old
Fashioned Syrup Company subsidiary which historically has
accounted for a significant percentage, at times greater than 90
percent, of our revenues," Goldberg said. "Not only will this
immediately increase our revenue stream but greatly enhance our
distribution efforts."

ChampionLyte Holdings, through its wholly owned subsidiary
ChampionLyte Beverages, Inc., manufactures, markets, sells and
distributes ChampionLyte(R), the first completely sugar-free entry
in the multi-billion dollar isotonic sports drink market.

Goldberg said results of sales of its initial production run of
the ChampionLyte(R) product will occur in the third quarter
numbers.

"Our restructuring plan is right on target," said Goldberg. "If
you eliminate the non-operating costs for this past quarter our
loses were nominal. That's quite an accomplishment when you take
into consideration the condition of the Company when the new
management team took over."

Goldberg pointed out highlights of the quarter:

* The Company successfully reached a settlement agreement in a
  lawsuit brought to reclaim its Old Fashioned Syrup Company
  subsidiary. The subsidiary historically accounted for a
  substantial percentage, at times greater than 90 percent, of the
  Company's revenues.

* The Company received a $1 million equity financing commitment.

* The Company secured a $500,000 financing commitment for accounts
  receivable and purchase orders.

* The Company signed an agreement to distribute ChampionLyte in
  the Middle East.

* The Company signed a distribution agreement with a leading
  Northeast vending company to distribute ChampionLyte(R) in the
  tri-state area.

* The Company received and fulfilled its initial purchase order
  from Atkins Nutritionals, Inc.

* The Company sold out its initial production run as demand for
  the ChampionLyte(R) exceeded expectations.

* The Company announced it would boost production of the sports
  drink.

ChampionLyte Holdings, Inc. is a fully reporting public company
whose shares are quoted on the OTC Bulletin Board under the
trading symbol CPLY. Its recently formed beverage division,
ChampionLyte Beverages, Inc., a Florida corporation, manufactures,
markets and sells ChampionLyte(R), the first completely sugar-free
entry into the multi-billion dollar isotonic sports drink market.

                         *     *     *

On June 25, 2003, Radin Glass & Co, LLP was dismissed as the
independent auditor for Championlyte Holdings Inc. and Massella
Roumbos LLP was appointed as the new independent auditor for the
Company.

Radin Glass & Co, LLP 's report on the financial statements for
the year ended December 31, 2002 contained an explanatory
paragraph reflecting an uncertainty because the realization of a
major portion of the Company's assets is dependent upon its
ability to meet its future financing requirements and the success
of future operations. These factors raise substantial doubt about
the Company's ability to continue as a going concern.


CIRTRAN: June 30 Working Capital Deficit Widens to $5 Million
-------------------------------------------------------------
Cirtran Corporation provides a mixture of high and medium size
volume turnkey manufacturing services using surface mount
technology, ball-grid array assembly, pin-through-hole and custom
injection molded cabling for leading electronics OEMs in the
communications, networking, peripherals, gaming, law enforcement,
consumer products, telecommunications, automotive, medical, and
semiconductor industries. Its services include pre-manufacturing,
manufacturing and post-manufacturing services. Through its
subsidiary, Racore Technology Corporation, the Company designs and
manufactures Ethernet technology products. The Company's goal is
to offer customers the significant competitive advantages that can
be obtained from manufacture outsourcing, such as access to
advanced manufacturing technologies, shortened product time-to-
market, reduced cost of production, more effective asset
utilization, improved inventory management, and increased
purchasing power.

Since February of 2000, Cirtran Corporation has operated without a
line of credit. Many of the Company's vendors stopped credit sales
of components used by the Company to manufacture products, and as
a result, the Company converted certain of its turnkey customers
to customers that provide consigned components to the Company for
production. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.

In addition, the Company is a defendant in numerous legal actions.  
These matters may have a material impact on the Company's
financial position, although no assurance can be given regarding
the effect of these matters in the future.

In view of the matters described in the preceding paragraphs,
recoverability of a major portion of the recorded asset amounts
shown in the Company's consolidated balance sheets is dependent
upon continued operations of the Company, which in turn is
dependent upon the Company's ability to meet its financing
requirements on a continuing basis, to maintain or replace present
financing, to acquire additional capital from investors, and to
succeed in its future operations.

During 2002, the Company entered into agreements whereby the
Company has issued common stock to certain principals of Abacas
Ventures, Inc. in exchange for a portion of the debt. The
Company's plans include working with vendors to convert trade
payables into long-term notes payable and common stock and cure
defaults with lenders through forbearance agreements that the
Company will be able to service. The Company intends to continue
to pursue this type of debt conversion going forward with other
creditors. The Company has entered into an equity line of credit
agreement with a private investor. Realization of any additional
proceeds under the equity line of credit is not assured.

Cirtran's expenses are currently greater than its revenues.
Cirtran has had a history of losses and its accumulated deficit
was $16,446,519 at June 30, 2003, and $15,230,302 at December 31,
2002. Net operating loss for the quarter ending June 30, 2003, was
$561,478, compared to $299,548 for the quarter ended June 30,
2002. Current liabilities exceeded the Company's current assets by
$5,333,449 as of June 30, 2003, and $4,490,623 as of December 31,
2002. The increase in the difference is mostly attributed to
increasing account payables, notes payable, and accrued
liabilities. For the six months ended June 30, 2003 and 2002,
Cirtran had negative cash flows from operations of $379,788 and
$918,652, respectively.  The Company had cash on hand of $45,526
at June 30, 2003, and $500 at December 31, 2002.


CKE RESTAURANTS: Reports Period 7 and 2nd Qtr. Same-Store Sales
---------------------------------------------------------------
CKE Restaurants, Inc. (NYSE: CKR), announced period seven and
second quarter same-store sales, for the four weeks ended August
11, 2003, for each of its major brands -- Carl's Jr., Hardee's and
La Salsa.

Brand          Period 7               Q2              Year to Date
           FY 2004  FY 2003   FY 2004  FY 2003   FY 2004   FY 2003
           -------  -------   -------  -------   -------   -------
Carl's Jr.  +4.6%   -2.8%     +2.3%     +0.6%     +0.8%     +2.6%
Hardee's    +2.6%   -2.4%     +1.0%     -1.0%     -1.7%     -0.3%
La Salsa    -3.1%   +3.2%     -2.0%     +1.9%     -2.0%     +1.8%

Commenting on the Company's performance, Andrew F. Puzder,
President and Chief Executive Officer, said, "Carl's Jr. and
Hardee's posted same-store sales increases this period of 4.6
percent and 2.6 percent, respectively."

"At Carl's Jr., The Western Bacon Six Dollar Burger(TM) -- the
second new product based on the award-winning The Six Dollar
Burger(TM) -- helped lift sales at the brand this period.  Both
The Guacamole Bacon Six Dollar Burger(TM) -- the first product
extension -- and The Western Bacon Six Dollar Burger have
contributed to increased sales of The Six Dollar Burger category
at Carl's Jr. this year."

Commenting on the performance at Hardee's, Puzder stated, "While
we are encouraged by our results at Hardee's this period, we
caution our stakeholders that results may fluctuate in future
periods.  Current marketing programs along with positive media
coverage and 'word-of-mouth' should help us to build awareness of
the Thickburger menu and increase trial over time.  To date, 90
percent of the Hardee's system has been converted to the new
menu."

The Company will report period eight same-store sales, for the
four weeks ending September 8, 2003, on or about September 17.

CKE Restaurants, Inc. (S&P, B Corporate Credit Rating, Negative),
through its subsidiaries, franchisees and licensees, operates over
3,200 restaurants, including 1,000 Carl's Jr. restaurants, 2,181
Hardee's restaurants, and 97 La Salsa Fresh Mexican Grills in 44
states and in 14 countries.


CLASSIC COMMS: Entry of Final Decree Delayed Until June 24, 2004
----------------------------------------------------------------
Upon Classic Communications, Inc.'s motion, the U.S. Bankruptcy
Court for the District of Delaware delays entry of a final decree
closing the Debtors' chapter 11 cases through June 24, 2004.

The Debtors remind the Court that they have worked diligently
since confirmation of the Plan to review and reconcile the proofs
of claim filed in these cases, as well as prosecute and resolve
other outstanding issues.  To date, however, several issues remain
unresolved.  The Debtors also believe there are other matters that
may need to be brought before the Court, including, but not
limited to, omnibus claim objections and avoidance actions.

Accordingly, delaying entry of a final decree will ensure that the
Debtors have a full opportunity to continue to commence avoidance
actions and address the claims reconciliation process and other
matters.

Classic Communications, Inc., a cable operator focused on non-
metropolitan markets in the United States, filed for Chapter 11
petition on November 13, 2001 (Bankr. Del. Case No. 01-11257).
Brendan Linehan Shannon, Esq. at Young, Conaway, Stargatt & Taylor
represents the Debtors in their restructuring efforts. When the
Company filed for protection from its creditors, it listed
$711,346,000 in total assets and $641,869,000 in total debts.


CONSUMERS ENERGY: Fitch Rates $400MM 144A FMBs Issuances at BB+
---------------------------------------------------------------
Fitch Ratings has assigned 'BB+' ratings to Consumers Energy Co.'s
$200 million issuance of 4.80% first mortgage bonds, due Feb. 17,
2009, and $200 million issuance of 6% FMBs, due Feb. 14, 2015. The
bonds are being issued to institutional buyers under Rule 144A of
the Securities Act. Proceeds from the sale will be used to
refinance debt. The Rating Outlook for Consumers is Stable.

Consumers' ratings and Stable Outlook recognize the solid
standalone credit characteristics of the regulated utility.
Ratings at Consumers are also subject to constraint resulting from
ownership linkage of CMS Energy (senior secured rated BB-, Rating
Outlook Negative by Fitch).

Consumers benefits from relatively predictable cash flows and
sound electric and gas monopoly distribution franchises. Liquidity
at Consumers improved with the completion of $540 million in
secured credit facilities earlier in the year, of which $250
million has been paid down. Of the remaining facilities, $150
million expires in March 2006 and $140 million expires in March
2009. As of June 30, 2003, the entire $290 million was outstanding
under the facilities.

Consumers continues to face regulatory decisions on its gas rate
case and securitization order. Recently, the Staff of the Michigan
Public Service Commission recommended interim rate relief of $80
million in response to Consumers' $156 million gas rate case
filing in March 2003. The interim increase is subject to Consumers
voluntarily agreeing to limit its dividends to CMS to a maximum of
$190 million in any calendar year. In 2002, Consumers dividended
up around $230 million to CMS. At this time it is too early to
determine the potential outcome, as hearings on the interim rate
case are scheduled for late August, and a decision possible by
early September.

In early June, the MPSC issued a financing order approving the
securitization of approximately $554 million in qualified costs
primarily related to environmental compliance costs and costs
associated with retail open access. Consumers has filed for a
rehearing and clarification on a number of features in the
financing order, including the rate design, accounting treatment
of unsecuritized qualified costs and dividend restriction. No
schedule has been set for the rehearing request. The financing
order would only become effective after the rehearing and upon
acceptance by Consumers. The company anticipates issuing the bonds
by the first quarter of 2004.

Consumers, the primary subsidiary of CMS Energy, is a combination
electric and natural gas utility that serves more than 3.3 million
customers in Michigan's Lower Peninsula.


CORAM HEALTHCARE: Trustee Has Until Dec. 31 to Decide on Leases
---------------------------------------------------------------
By order of the U.S. Bankruptcy Court for the District of
Delaware, the Chapter 11 Trustee for Coram Healthcare Corp.'s
estates obtained an extension of time to decide how to dispose of
Coram's leases.  The Court gives the Trustee until December 31,
2003, to determine whether to assume, assume and assign, or reject
Coram's unexpired nonresidential real property leases.

Coram Healthcare, a provider of home infusion-therapy services
filed for Chapter 11 bankruptcy protection on August 8, 2000
(Bankr. Del. Case No. 00-3299).  Kenneth E. Aaron, Esq., at Weir &
Partners LLP and Barry E. Bressler, Esq., at Schnader Harrison
Segal & Lewis LLP represent the Chapter 11 Trustee in these
proceedings.


CORUS: Weaker-than-Expected Cash Flows Prompt Negative Outlook
--------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
diversified Canadian media company, Corus Entertainment Inc. to
negative from stable. At the same time, the ratings on Corus,
including the 'BB' long-term corporate credit rating, were
affirmed.
     
Toronto, Ont.-based Corus is the largest Canadian radio operator,
which owns or has interest in a number of specialty television
networks, and through Nelvana Ltd. a producer of animated
children's programming.
     
"The revised outlook reflects a slower-than-expected expansion of
Corus' cash flow base, due to not only cyclical economic factors,
but also a structural decline in pricing for the company's
programming, limiting the long-term financial prospects of
Nelvana," said Standard & Poor's credit analyst Barbara Komjathy.
Although Corus generates positive free cash flows, and operating
margins have improved for its broadcast division, its reformatted
radio stations continue to dampen overall improvement in
profitability. Moreover, Nelvana's lower-than-expected future
contribution to operating income also negatively affects Standard
& Poor's view of Corus' business profile.
     
The ratings on Corus reflect the company's relatively aggressive
financial profile due to its acquisition-oriented growth strategy;
its relatively small free cash flow base; and its cyclical
industry fundamentals, particularly advertising revenues and
demand for content. The ratings are supported by the company's
strong market position of its core radio, specialty television,
and production businesses; and by the revenue diversity provided
by these assets, positive advertising growth dynamics for the
specialty television industry, and favorable Canadian broadcasting
regulatory regime that limits foreign and to some extent, domestic
competition.
     
Corus generated C$626.7 million of revenues and C$165.2 million of
EBITDA (adjusted for operating leases, certain deferred charges,
and excluding library write-down of C$40.0 million) in the 12
months ended May 30, 2003, and had C$672.8 million of lease-
adjusted debt outstanding.

The negative outlook reflects concerns over Corus' relatively
aggressive financial profile, which has failed to improve in the
past 18-months to levels previously expected by Standard & Poor's.
To maintain the ratings, Corus is expected to retain the strong
business positions of its core businesses and pursue a financial
policy and growth strategy that will not prevent the ongoing
improvement of key credit measures to be more in line with the
ratings category. The ratings could be lowered if the company
fails to maintain its positive free cash flow generation and
improve key credit measures.


CRYOLIFE INC: Names Dr. Ray as Associate Medical Director
---------------------------------------------------------
CryoLife, Inc. (NYSE: CRY), has appointed Gregory Ray, M.D., a
board certified pathologist, Associate Medical Director.  

Dr. Ray will report directly to J. Robin de Andrade, M.D., Medical
Director.  Dr. Ray will be responsible for establishing Cryolife's
in-house pathology laboratory, which will work closely with the
Quality Assurance department.  Dr. Ray will also provide expertise
in determining suitability of donors and tissues and will interact
with tissue procurement organizations and medical examiners.

Dr. Ray joins CryoLife from Pathworks Anatomic Laboratory where he
has worked since 2000 and served most recently as medical
director.  Dr. Ray also worked for the Georgia Bureau of
Investigation, Division of Forensic Sciences, Emory University
School of Medicine and North Lake Medical Center.

"Gregory is highly and uniquely qualified to establish our
pathology lab as well as coordinate activities with procurement
organizations and medical examiners," said J. Robin de Andrade,
M.D., CryoLife's Medical Director.  "His experience will help us
work toward increasing the efficiency and timeliness of the
Company's tissue processing."

Dr. Ray received a B.S. from Oglethorpe University, and an M.D.
from the Medical College of Georgia and completed residence
training in pathology and laboratory medicine at Emory University.

Founded in 1984, CryoLife, Inc. is a leader in the processing and
distribution of implantable living human tissues for use in
cardiovascular and vascular surgeries throughout the United States
and Canada.  The Company's BioGlue(R) Surgical Adhesive is FDA
approved as an adjunct to sutures and staples for use in adult
patients in open surgical repair of large vessels and is CE marked
in the European Community and approved in Canada for use in soft
tissue repair and approved in Australia for use in vascular and
pulmonary sealing and repair.  The Company also manufactures the
SynerGraft(R) Vascular Graft, which is CE marked for distribution
within the European Community.

For additional information about the company, visit CryoLife's Web
site: http://www.cryolife.com

                         *     *     *

                 Liquidity and Capital Resources

In its Form 10-Q filed with the Securities and Exchange
Commission, CryoLife Inc., reported:

        Overall Trend in Liquidity and Capital Resources

"The Company expects its liquidity to continue to decrease
significantly over the next twelve months due to 1) the
anticipated decrease in preservation revenues as compared to
preservation revenues prior to the FDA Order as a result of
reported tissue infections, the FDA Order, and associated adverse
publicity, 2) the increase in cost of human tissue preservation
services as a percent of revenue as a result of lower tissue
processing volumes and changes in processing methods, which have
increased the cost of processing human tissue and 3) an expected
use of cash due to the increased costs relating to the defense and
resolution of lawsuits and legal and professional costs relating
to the ongoing FDA compliance and the anticipated required Term
Loan pay off during 2003. The Company believes that anticipated
revenue generation, expense management, savings resulting from the
reduction in the number of employees in September 2002
necessitated by the reduction in revenues, and the Company's
existing cash and marketable securities will enable the Company to
meet its liquidity needs through at least June 30, 2004. In
addition, the Company has recorded $9.0 million related to the
potential expense of resolving current product liability claims in
excess of insurance coverage. The $9.0 million accrual is
reflective of settlement costs related to outstanding lawsuits,
and does not reflect actual settlement arrangements or judgments,
including punitive damages, which may be assessed by the courts.
The $9.0 million accrual is not a cash reserve. Should expenses
related to the accrual be incurred, the expenses would have to be
paid from insurance proceeds and liquid assets, if available. The
Company has called a meeting with the plaintiffs' attorneys to
determine the feasibility of obtaining a global settlement on
outstanding claims in order to substantially reduce the potential
cash payout related to these accruals and is currently evaluating
all of its alternatives in connection with resolving the dispute
with its upper layer excess carrier concerning the restrictions on
the matters it has excluded from coverage. If the Company is
unsuccessful in arranging settlements of product liability claims
for an amount substantially below the amount accrued, there may
not be sufficient insurance coverage and liquid assets to meet
these obligations, even if the Company satisfactorily resolves the
restrictions on the upper layer excess insurance coverage.
However, if the Company is unable to settle the outstanding claims
for amounts within its ability to pay and one or more of the
product liability lawsuits in which the Company is a defendant
should be tried during this period with a substantial verdict
rendered in favor of the plaintiff(s), there can be no assurance
that such verdict(s) would not exceed the Company's available
insurance coverage and liquid assets. The Company's product
liability insurance policies do not include coverage for any
punitive damages that may be assessed at trial. There is a
possibility that significant punitive damages could be assessed in
one or more lawsuits which would have to be paid out of the liquid
assets of the Company, if available.

"In addition, the Company has recorded $7.5 million for estimated
costs of unreported product liability claims related to services
performed and products sold prior to June 30, 2003. The $7.5
million accrual is not a cash reserve. The timing of the actual
payment of the expense related to the accrual is dependent on when
and if claims are asserted. Should expenses related to the accrual
be incurred, the expenses would have to be paid from insurance
proceeds and liquid assets, if available. Since amounts expensed
are estimates, the actual amounts required could vary
significantly.

"The Company's long term liquidity and capital requirements will
depend upon numerous factors, including the Company's ability to
return to the level of demand for its tissue services that existed
prior to the FDA Order, the outcome of litigation against the
Company, the timing of and amount required to resolve the product
liability claims, the resolution of the dispute with its upper
excess product liability insurance carrier, the ability to arrange
and fund a global settlement of outstanding claims for an amount
substantially below the amount of the accrual, and the Company's
ability to find suitable funding sources to replace the Term Loan.
The Company may require additional financing or seek to raise
additional funds through bank facilities, debt or equity
offerings, or other sources of capital to meet liquidity and
capital requirements beyond June 30, 2004. Additional funds may
not be available when needed or on terms acceptable to the
Company, which could have a material adverse effect on the
Company's business, financial condition, results of operations,
and cash flows. These are factors that indicate that the Company
may be unable to continue operations.

"On August 4, 2003 the Company approved a buyback of employee
stock options with an exercise price of $23 or greater. The option
buyback was approved for an aggregate of up to $350,000 using a
Black Scholes valuation model. The Company anticipates making the
offer to employees in third quarter of 2003.

                       Net Working Capital

"At June 30, 2003 net working capital (current assets of $52.6
million less current liabilities of $31.8 million) was $20.8
million, with a current ratio (current assets divided by current
liabilities) of 2 to 1, compared to net working capital of $37.6
million, with a current ratio of 3 to 1 at December 31, 2002. The
Company's primary capital requirements historically arose from
general working capital needs, capital expenditures for facilities
and equipment, and funding of research and development projects.
The Company has historically funded these requirements through
bank credit facilities, cash generated by operations, and equity
offerings. Based on the decrease in revenues resulting from the
adverse publicity surrounding the FDA Order, FDA Warning Letter,
and reported tissue infections, and the anticipated costs to be
paid by the Company in resolving pending litigation, the Company
expects that its cash used in operating activities will continue
to be high and will increase to the extent funds are needed to
defend and resolve litigation, and that net working capital will
significantly decrease.

"The Company's Term Loan, of which the principal balance was $4.5
million as of August 4, 2003, contains certain restrictive
covenants including, but not limited to, maintenance of certain
financial ratios and a minimum tangible net worth requirement, and
the requirement that no materially adverse event has occurred. The
lender has notified the Company that the FDA Order have had a
material adverse effect on the Company that constitutes an event
of default. Additionally, as of June 30, 2003, the Company is in
violation of the debt coverage ratio and net worth financial
covenants. Therefore, all amounts due under the Term Loan as of
June 30, 2003 are reflected as a current liability on the Summary
Consolidated Balance Sheets. The Company and the lender are
currently in the process of negotiating specific terms of a
forbearance agreement, which, if entered into, would increase the
interest rate charged on the Term Loan effective August 1, 2003 to
LIBOR plus 4% (5.32% at June 30, 2003), accelerate the principal
payments on the Term Loan by requiring a balloon payment to pay
off the outstanding balance by October 31, 2003, and cause the
Company to pay a $12,000 modification fee and the lender's
attorneys costs, which have yet to be determined. As of August 4,
2003 the Company has sufficient cash and cash equivalents to pay
the remaining outstanding balance of the Term Loan. Since the
lender is in the process of accelerating the payment of the debt,
the above chart shows payment of the outstanding balance of the
Term Loan during 2003.

"In the quarter ended June 30, 2003 the Company entered into two
agreements to finance $2.9 million in insurance premiums
associated with the yearly renewal of certain of the Company's
insurance policies. The amount financed accrues interest at a
3.75% rate and is payable in equal monthly payments through
January 2004. As of August 4, 2003 the outstanding balance of the
agreements was $1.3 million.

"Due to cross default provisions included in the Company's debt
agreements, as of June 30, 2003 the Company was in default of
certain capital lease agreements maintained with the lender of the
Term Loan. Therefore, all amounts due under these capital leases
are reflected as a current liability on the Summary Consolidated
Balance Sheets as of June 30, 2003."


DDI CORP: June 30 Balance Sheet Insolvency Widens to $198 Mill.
---------------------------------------------------------------
DDi Corp. (OTC Bulletin Board: DDIC), a leading provider of time-
critical, technologically advanced interconnect services for the
electronics industry, announced financial results for the three
and six months ended June 30, 2003.

The Company's financial results for the second quarter include
charges pertaining to operational cost savings initiatives, the
Company's comprehensive financial restructuring begun early this
year, and a $2 million non-cash adjustment to the carrying amount
of goodwill.

                 Second Quarter Operating Results

The Company reported net sales for the second quarter of 2003 of
$56.2 million, a decrease of $5.9 million (9%) compared with net
sales of $62.1 million for the second quarter of 2002. The
decrease in net sales from the second quarter of 2002 reflects the
disposition of certain non-core facilities during the latter part
of 2002 and a reduction in the average price per panel reflecting
softened economic conditions in North America and Europe. The
Company did benefit, however, from growth in its European assembly
operations and the acquisition of Kamtronics Limited in October
2002, now known as DDi International. DDi International is the
Company's U.K.-based business that procures offshore, volume
production services for PCB customers throughout Europe.

Net sales for the second quarter of 2003 decreased 9% from $61.7
million recorded in the first quarter of 2003. The decrease in
revenues from the first quarter of 2003 reflects a lower level of
panel shipments and the disposition of the Company's Dallas-based
metal enclosures facility in the second quarter of 2003. The
decrease in panel shipments resulted from weakness in end market
demand and also to the Company's decision to focus on higher
margin business.

"The second quarter proved challenging in the face of continued
weakness in end market demand. We are very pleased, however, with
our progress toward identifying and winning business that offers
rational pricing opportunities. Although our emphasis on high
margin business may have reduced order volume for the second
quarter, we have begun to experience an improvement in bookings
thereafter," commented Bruce McMaster, Chief Executive Officer of
DDi.

On a GAAP basis, gross profit for the second quarter of 2003 was
$2.0 million, or 3% of net sales, compared to $2.7 million, or 4%
of net sales, for the comparable period in 2002. Excluding
restructuring-related inventory write-downs in each period, gross
profit for the second quarter was $3.7 million, or 7% of net
sales, compared to gross profit of $6.2 million, or 10% of net
sales, for the comparable period of 2002. The decreases in gross
profit (expressed in dollars and as a percentage of net sales)
from the second quarter of 2002 is due primarily to the reduction
in revenues. Mitigating the impact of the lower level of revenues
was cost savings achieved from operational restructuring
activities undertaken during the latter part of 2002 and the first
half of 2003.

"DDi remains committed to delivering the consistent level of
technological leadership and top-notch service expected by its
customers, while maintaining a competitive cost structure. Our
operational changes are aligned with all of these objectives.
Specifically, we have been optimizing capacity and production mix
amongst our facilities, taking into account divisional
specialization, customer expectations, and relative cost
structures of the various plants. DDi has also disposed of its
Dallas-based metal enclosures operation to allow the Company to
focus on its core competencies. Toward these ends, DDi incurred
restructuring charges of $3.3 million in the second quarter of
2003. In addition, the Company is in the process of reducing
excess leased facilities in its Anaheim, California campus to
increase throughput efficiencies and eliminate excess plant costs.
Together, the above initiatives are expected to reduce expenses by
approximately $6 million per year. We bore some operational
inefficiency in our implementation of our recent restructuring
actions, reflected in our current quarter operating margins, but
we expect to see the financial benefit of these restructuring
initiatives materialize in the third quarter 2003. Although the
current quarter demand was lighter than anticipated, we have begun
experiencing heightened demand for July and August. We expect to
capitalize on our significant operating leverage to the extent the
strengthening in bookings persists," added McMaster.

Sales and marketing expenses and general and administration
expenses decreased 16% to $9.1 million for the second quarter of
2003 from $10.8 million for the same period in 2002. This decline
reflects the Company's continued cost control efforts.

In the second quarter of 2003, DDi incurred reorganization charges
totaling $2.7 million and a non-cash charge of $5.6 million
resulting from the termination of an interest rate swap agreement.

In the second quarter of 2003, the Company recorded an income tax
benefit of $0.6 million, net of valuation allowances applied to
the U.S. deferred tax asset recorded for the quarter. Such
allowances were based upon management's expectation that U.S.
federal and state deferred tax assets would not likely be
realized.

On the basis of GAAP, the Company reported a net loss of $26.1
million, or $0.53 per share, for the second quarter of 2003,
compared to a net loss of $85.6 million, or $1.78 per share, for
the second quarter of 2002. The reduction in the net loss
primarily reflects a reduction in non-cash charges, consisting
principally of goodwill impairments.

DDi reported an adjusted net loss of $7.3 million, or $0.15 per
share, for the second quarter of 2003 as compared to an adjusted
net loss of $6.2 million, or $0.13 per share, for the comparable
period of 2002. The increase in adjusted net loss is due to the
decline in gross profit noted above.

                    First Half 2003 Results

For the six months ended June 30, 2003, net sales were $117.9
million, compared to $124.6 million for the first half of 2002.
The decrease in net sales is attributable to the disposition of
non-core operations commencing in the latter part of 2002
(reducing sales by approximately $17.3 million) and soft pricing,
particularly in the Company's European operations. These factors
were largely offset by the acquisition of Kamtronics Limited,
which contributed over $9 million in revenue in the first half of
2003.

On the basis of GAAP, gross profit for the six-month period ended
June 30, 2002 was $6.4 million, compared to $9.1 million for the
comparable period of 2002. Gross profit excluding restructuring-
related inventory impairments was $8.2 million, compared to $12.5
million for the first six months of last year. The decline in
gross profit resulted principally from the continued softness in
pricing noted above.

Sales and marketing expenses and general and administration
expenses decreased 17% to $17.8 million for the first half of 2003
from $21.4 million for the same period in 2002. This decline
reflects the Company's continued cost control efforts.

On the basis of GAAP, DDi reported a net loss of $40 million, or
$0.81 per share, for the first half of 2003, compared to a net
loss of $91.6 million, or $1.91 per share, for the same period in
2002. The reduction in the net loss primarily reflects a reduction
in non-cash charges, consisting principally of goodwill
impairments.

The Company reported an adjusted net loss of $13.9 million, or
$0.28 per share, for the first half of 2003, compared to an
adjusted net loss of $12.1 million, or $0.25 per share, for the
first half of 2002. The increase in adjusted net loss is due
primarily to the decline in gross profit noted above.

                          Liquidity

As of June 30, 2003, total cash, cash equivalents and marketable
securities were $24.1 million (including $9.4 million in
restricted funds). Net usage of cash, cash equivalents and
marketable securities during the second quarter of 2003 was $1.8
million, resulting primarily from the funding of DDi's operational
and financial restructuring initiatives. Excluding such costs,
total cash, cash equivalents and marketable securities would have
increased by approximately $1.4 million, due primarily to working
capital management.

DDi Corp.'s June 30, 2003 balance sheet shows a working capital
deficit of about $270 million, and a total shareholders' equity
deficit of about $198 million.

Dynamic Details is currently in default under its senior credit
facility. DDi Capital is currently in default under its 12.5%
senior discount notes. DDi Corp. is currently in default under its
5.25% and 6.25% convertible subordinated notes. Based upon the
expectation that the above indebtedness will not be repaid in
accordance with their respective terms, the Company has classified
the total amount of such indebtedness, accrued interest on the
convertible subordinated notes and the senior discount notes, and
the deferred cost of the interest rate swap agreement termination
(aggregating $298.2 million) as current obligations in the
accompanying Condensed Consolidated Balance Sheet. On the basis of
GAAP, total current liabilities were $361.8 million and working
capital was negative $271.7 million as of June 30, 2003. Excluding
the classification of the principal balance of the aforementioned
indebtedness and aforementioned accrued costs as current
obligations, total current liabilities would have been $63.6
million and working capital would have been $26.5 million as of
June 30, 2003.

The Company issued a press release dated August 14, 2003 which
provides an update as to the status of the comprehensive
restructuring pertaining to the Company's indebtedness, including
the fact that DDi Corp. and DDi Capital Corp. filed voluntary
petitions for reorganization under Chapter 11 of the United States
Bankruptcy Code on the United States Bankruptcy Court for the
Southern District of New York to implement the Company's
restructuring of its domestic debt through a pre-arranged
reorganization.

As part of the restructuring, the Company and its senior lenders
have signed an amendment to the Dynamic Details senior credit
facility. The amendment, among other things, defers all remaining
2003 principal amortization payments, including the one due on
August 1, 2003, to January 30, 2004. Interest and fees remain
payable currently. As a result of the Company's current defaults
under its indebtedness, the Company is unable to borrow any
additional funds under the Dynamic Details senior credit facility.
As of June 30, 2003, DDi Europe had $10.1 million outstanding
under its revolving credit facility and had approximately $1.5
million available for borrowing under its revolving credit
facility.

During the restructuring process, the holders of the Dynamic
Details senior credit facility will monitor and control the
Company's cash and cash equivalents held in certain accounts.
Substantially all of our cash, cash equivalents and marketable
securities available for sale has been, and during the
restructuring period will be, deposited into these accounts.

The deferral of payments due under the Company's senior credit
facility, along with the Company's current cash position and, with
respect to DDi Europe, borrowings under DDi Europe's credit
facility, should provide the Company with sufficient liquidity to
meet its liquidity needs through the completion of the
reorganization. Assuming the reorganization is confirmed as
currently contemplated, the Company believes, based upon the
Company's current level of operations, that cash generated from
operations, available cash, cash equivalents and marketable
securities and amounts available under the restructured senior
credit facility will be adequate to meet the Company's debt
service requirements, capital expenditures and working capital
needs for the foreseeable future, although no assurance can be
given in this regard.

"We believe we are taking all the necessary actions to ensure that
DDi has sufficient liquidity to weather continued weakness in end
market demand. We are encouraged by a strengthening in order flow
following the second quarter of 2003. This activity is broadly-
based and signals our customers' continued recognition of DDi's
technological capabilities, quality of service and financial
viability," concluded McMaster.

DDi is a leading provider of time-critical, technologically
advanced, electronics manufacturing services. Headquartered in
Anaheim, California, DDi and its subsidiaries offer fabrication
and assembly services to customers on a global basis, from its
facilities located across North America and in England.


DIALOG GROUP: Delays Filing of Form 10-Q for June Quarter
---------------------------------------------------------
Dialog Group, Inc.'s financial statements for the quarter ended
June 30, 2003 could not be filed with the SEC within the
prescribed period because the Company was unable to completely and
accurately value the assets and liabilities arising from the
acquisition of a new subsidiary and the assets (subject to certain
liabilities) of another entity acquired during the period. This
information is necessary to assure an accurate report on the
internal financial aspects of the Company. This problem could not
have been eliminated by the Company without unreasonable effort or
expense.

The Company's consolidated revenue (proforma) increased over 13%
during the second quarter as compared with the same period in
2002. The Company's consolidated net loss (proforma) for the
quarter was reduced to about $555,000 from about $2,245,000 during
the quarter ended June 30, 2002. The Company's consolidated
revenue (proforma) increased over 8% during the first half of this
year as compared with the same period in 2002. The Company's
consolidated net loss (proforma) for the first six months was
reduced to about $1,163,000 from about $3,124,000 during the half
year ended June 30, 2002.

                         *     *     *

                  Going Concern Uncertainty

In its Form 10-QSB filed with the Securities and Exchange
Commission, Dialog Group Inc., reported:

"The [Company's] condensed consolidated financial statements have
been presented assuming the continuity of the Company as a going
concern.  However, the Company has incurred substantial losses
resulting in an accumulated deficit of approximately $3,682,000 as
of June 30, 2003. These conditions raise substantial doubt as to
the ability of the Company to continue as a going concern.

"Management's plans with regards to this issue are as follows:

                         LIQUIDITY

   The Company is continuing the sale of its equity securities,
    as further discussed in Note 9. During the second quarter of
    2003, the Company raised approximately $467,000 in such
    activities.

                      PROFITABILITY

"The Company intends to develop new and increased revenues and
gross margins in all areas of operations. Specifically, the
Company intends to:

   Restructure its sales organization to allow for more effective
    sales processes. These steps include, among others,
    consolidating sales operations for subscription sales in
    offices in Florida, as well as expansion of sales
    organization.
      
   Reduce expenses through office consolidation and payroll
    reduction.
      
   Enter into strategic relationships with data suppliers that
    will return higher levels of match rate with a better quality
    of data.

"Many of these profitability objectives have been met early in the
second quarter.

Presently, the Company cannot ascertain the eventual success of
management's plans with any degree of certainty. The accompanying
condensed consolidated financial statements do not include any
adjustments that might result from the eventual outcome of the
risks and uncertainty described above."


DIRECTV: Has Until September 15 to Move Pending Actions to Del.
---------------------------------------------------------------
U.S. Bankruptcy Court Judge Walsh extends the time period within
which DirecTV Latin America, LLC may file notices of removal of
related proceedings under Rule 9027(a) of the Federal Rules of
Bankruptcy Procedure to and including the latest to occur of:

   (a) September 15, 2003, or

   (b) 30 days after entry of an order terminating the automatic
       stay with respect to the particular action sought to be
       removed. (DirecTV Latin America Bankruptcy News, Issue No.
       11; Bankruptcy Creditors' Service, Inc., 609/392-0900)


DRS TECH: Ratings Under Review for Possible Downgrade
-----------------------------------------------------
The ratings for DRS technologies, Inc., is under review for
possible downgrade by Moody's Investors Service. The action
follows the company's announcement of a planned buy-out of
Integrated Defense Technologies, Inc., for $550 million in cash
and DRS common shares.

                        Affected Ratings

* Ba3 - $125 million guaranteed senior secured revolving credit
  facility due 2006

* Ba3 - $212.5 million guaranteed senior secured term loans due
  2008

* Ba3 - Senior implied rating

* B1 - Unsecured issuer rating

The ratings review will evaluate the impact of the proposed
financing to the capital structure and credit statistics of the
Company after the acquisition. The borrowings will cover part of
the acquisition costs while DRS equity and excess cash will fund
the balance.

DRS Technologies, Inc., a second-tier supplier of defense
electronic systems to the US military and intelligence agencies,
is headquartered in Parsippany, New Jersey.


DYNAMOTIVE ENERGY: Completes Filing Audited Financial Statements
----------------------------------------------------------------
DynaMotive Energy Systems Corp. (OTCBB:DYMTF), has completed its
December 31st, 2002 audited financial statements and its March 31,
2003 (un-audited) financial statements.

These statements and other related documents have been filed with
the SEC and the British Columbia Securities Commission. This puts
the Company up to date with all its regulatory filing
requirements.

DynaMotive is an energy systems company that is focused on the
development of innovative energy solutions based on its patented
fast pyrolysis system. Through the application of fast pyrolysis,
DynaMotive has shown how to unlock the natural energy found in the
world's abundant organic resources that have been traditionally
discarded by the agricultural and forest industries and to
economically convert them into a renewable and environmentally
friendly fuel. DynaMotive has successfully demonstrated conversion
of these residues into fuel known as BioOil, as well as char and
in doing so establishing these residues as a renewable,
environmentally friendly and cost competitive energy reserve.

                            *    *    *

In its most recent SEC Form 10-K filing, the Company reported:

"In May 2001, the Company announced its intention to divest its
metal cleaning subsidiary, DynaPower, Inc., to focus all of its
resources on its BioOil production technology. This divestiture
was completed April 11, 2002.

"These financial statements have been prepared on the going
concern basis, which presumes the Company will be able to
realize its assets and discharge its liabilities in the normal
course of operations for the foreseeable future.

"As at December 31, 2001, the Company has a working capital
deficiency of $2,069,212, has incurred a net loss of $6,838,264
for the year-ended December 31, 2001, and has an accumulated
deficit of $25,773,048.

The ability of the Company to continue as a going concern is
uncertain and is dependent on achieving profitable operations,
commercializing its BioTherm(TM) technology and continuing
development of new technologies, the outcome of which cannot be
predicted at this time. Accordingly, the Company will require,
for the foreseeable future, ongoing capital infusions in order
to continue its operations, fund its research and development
activities, and ensure orderly realization of its assets at
their carrying value. The consolidated financial statements do
not reflect adjustments in carrying values and classifications
of assets and liabilities that would be necessary should the
Company not be able to continue in the normal course of
operations.

"The Company is not expected to be profitable during the ensuing
twelve months and therefore must rely on securing additional
funds from government sources and by the issuance of shares of
the Company for cash consideration. The Company has received
commitments from the Canadian and UK governments and subsequent
to the year-end, the Company has received a subscription
agreement for up to $1.6 million in equity financing."


EAGLE FOOD CENTERS: Selects Best Bids for Assets of 8 Stores
------------------------------------------------------------
Eagle Food Centers, Inc., which owns and operates supermarkets in
Illinois and Iowa, has accepted bids for certain assets of eight
of its stores.

The Kroger Company has emerged as the highest and best bidder for
the following six stores: Sterling, IL; Lincoln, IL; Decatur, IL,
Ottawa, IL and two stores in Rockford, IL. SVT LLC emerged the
successful bidder for the Kankakee, Illinois store and Harold E.
Wisted was deemed the successful bidder with respect to the
Woodstock, IL store. In addition, on August 19, 2003, a purchase
agreement between Eagle Foods and J.B. Sullivan, Inc. was filed
with the Court for the sale of Eagle's Freeport, IL store and will
be heard for approval at the September 11th hearing.

Eagle intends to submit the results of Wednesday's auction for
approval of the sale of such assets by the United States
Bankruptcy Court for the Northern District of Illinois at a
hearing in Chicago on September 11, 2003.

The Company continues to pursue opportunities for the balance of
its stores, including setting a subsequent auction for 10 of its
stores on August 28th and extending the bid deadline to September
11th for the remaining stores.

As previously announced, a court hearing was scheduled for August
21, 2003 to consider the sale of certain assets of the Dubuque,
IL, Moline, IL and Bettendorf, IA locations to Hy-Vee and certain
assets of the Rochelle, IL location to J.B. Sullivan, Inc.

The Company operates 50 Eagle Country Markets in Iowa and
Illinois.


EL PASO ELECTRIC: Moody's Confirms Baa3 Sr. Secure Debt Rating
--------------------------------------------------------------
Moody's Investors Service confirmed the Baa3 Senior Secured debt
rating of El Paso Electric Company and revises the rating outlook
to negative from stable.

Moody's says that the company's Baa3 debt rating reflects the
stable cash flow generated by El Paso Electric and the improvement
to its financial flexibility and credit profile.

El Paso generates and distributes electricity to customers in West
Texas and Southern New Mexico. The company is based in El Paso,
Texas.


EMAGIN CORP: June 30 Net Capital Deficit Cut by Half to $6 Mill.
----------------------------------------------------------------
eMagin Corporation (AMEX:EMA), the leading developer of organic
light emitting diode microdisplay technology, reported its first
quarterly profit with a net income of $0.516 million, or $0.02 per
share, for the second quarter of 2003, as compared to a loss of $4
million, or $0.13 per share, in the second quarter of 2002.

The gain was principally due to the successful effects of debt and
payables restructuring that occurred during the second quarter.
Revenue for the second quarter ending June 30, 2003 was
approximately $0.31 million, compared to $0.27 million in the
second quarter of 2002, an approximate 14% increase.

The company completed a financing in April 2003, and then
restructured much of its debt, payables, and fixed costs. eMagin
then began ordering supplies for increased display and display
accessory production targeted for future quarters.

"Our financial situation was greatly improved following the end of
the second quarter as we received additional funds from the April
2003 financing and as a result of the related debt and fixed cost
restructurings," said Gary Jones, eMagin's president and chief
executive officer. "We received about $1.4 million since June 30,
2003 as the previously scheduled part of the April financing. We
still expect to receive an additional $1.3 million from the prior
financing commitment."

Mr. Jones continued, "Long lead time supplies are now starting to
arrive and the company is better poised for increasing revenue.
The number of new customers working to place our displays in new
products is again increasing. All market applications segments for
our near-eye microdisplays for games, PC, medical, industrial,
military, and commercial applications continue to look strong. Our
OLED based microdisplay's low power consumption, temperature
range, speed, color range and depth, and cost provide significant
benefits over alternative technologies and should accelerate the
opening of many new emerging market segments. We continue to
believe that we are well positioned for the leadership role in the
emerging market for near to the eye high resolution displays."

The Company's June 30, 2003 balance sheet shows a working capital
deficit of about $2 million, and a total shareholders' equity
deficit of about $6 million.

A leading developer of virtual imaging technology, eMagin combines
integrated circuits, microdisplays, and optics to create a virtual
image similar to the real image of a computer monitor or large
screen TV. This miniature, high-performance, modules provide
access to information-rich text, data, and video, which can
facilitate the opening of new mass, markets for wearable personal
computers, wireless Internet appliances, portable DVD-viewers,
digital cameras, and other emerging applications. eMagin's
intellectual property portfolio is leveraged by key OLED
technology licensed from Eastman Kodak and joint development
programs with IBM and Covion, among others. OLEDs are emissive
devices (i.e., they create light), as opposed to liquid crystal
displays (LCDs) that require a separate light source. OLED devices
use less power and are capable of high brightness and color.
Because the light they emit appears equally bright from all
directions, they are ideal for near to the eye applications since
a small movement in the eye does not change the image. According
to Stanford Resources, a leading market research firm focusing on
the global electronic display industry, the worldwide market for
OLED displays will grow to $1.6 billion in 2007, or 63% a year
over that period. eMagin's corporate headquarters and microdisplay
operations are co-located with IBM on its campus in East Fishkill,
N.Y. Wearable and mobile computer headset/viewer system design and
full-custom microdisplay system facilities are located at its
wholly owned subsidiary, Virtual Vision, Inc., in Redmond, WA. The
company has marketing offices in Santa Clara, CA. Further
information about eMagin and its virtual imaging solutions can be
accessed at http://www.emagin.com  


ENRON CORP: Wind Unit Wants to Restructure Intercompany Loans
-------------------------------------------------------------
Enron Wind LLC indirectly owns 100% of Aeolos S.A. and Iweco
Megali Vrissi S.A.  According to Martin A. Sosland, Esq., at
Weil, Gotshal & Manges LLP, in New York, Aeolos holds a 9.9-
megawatt wind power project while Iweco holds a 4.95-megawatt
wind power project, both located on Crete, Greece.  Crete Hellas
Holdings, B.V. is the immediate parent company of both Aeolos and
Iweco.  

Mr. Sosland relates that both the Aeolos and Iweco projects came
into commercial operation in 1999 and each has a 10-year power
purchase agreement with The Public Power Corporation, the local
distribution company.

Aeolos and Iweco owe an aggregate of EUR11,200,000 to the
Debtors, Crete Hellas and Enron Wind Development LLC.  Moreover,
the Aeolos and Iweco projects were financed, in part, with loans
from Bayerisch Hypo- and Vereinsbank AG, Athens Branch -- HVB.  
The Loans' aggregate balance is currently EUR2,900,000.

To secure repayment of the loan from HVB, Crete Hellas pledged
the shares of Aeolos and Iweco.  In addition, each of Aeolos and
Iweco granted HVB security interests in its power purchase
agreements, wind turbines and other assets associated with the
wind power projects.

Pursuant to Greek commercial law, in the event the net equity of
an entity is less than 10% of share capital, a company's
operating license can be revoked by the relevant Greek
authorities.  Mr. Sosland reports that neither Aeolos' nor
Iweco's net equity meets the 10% of share capital threshold.  
Therefore, Aeolos and Iweco require additional capital
contributions of at least EUR1,755,000 and EUR1,354,000, for a
total of EUR3,109,000.  

To provide a buffer for short-term future capitalization needs,
additional amounts of EUR49,000 and EUR64,000 for Aeolos and
Iweco are needed for a total of EUR3,222,000.  Loss of the
operating licenses would result in a termination of the power
purchase agreements resulting in material adverse consequences.  
Moreover, Mr. Sosland provides, the loan agreements with HVB
specifically require that Aeolos and Iweco comply with the 10% of
share capital threshold requirement and with Greek law.

Mr. Sosland informs Judge Gonzalez that Crete Hellas currently
does not have sufficient cash on hand to make cash capital
contributions to Aeolos and Iweco in compliance with the 10% of
share capital threshold.  Accordingly, as an alternate means to
adequately capitalize Aeolos and Iweco, EWD, EW, and EWHS propose
to assign to Crete Hellas pro rata portions of intercompany
receivables due from Aeolos and Iweco, in exchange for which
Crete Hellas will agree to become obligated to EW, EWD, and Enron
Wind Hellas Services, S.A. in corresponding amounts.  In other
words, Crete Hellas will effectively assume a portion of the
obligations currently owed by Aeolos and Iweco to EW, EWD, and
EWHS.  Crete Hellas will then capitalize, by converting to
equity, the receivables from Aeolos and Iweco.  

In addition, to complete the needed recapitalization for Aeolos
and Iweco, Crete Hellas will capitalize all of its present
receivables from Aeolos and Iweco, totaling EUR822,000 into
equity.  EWD, EW and EWHS hold receivables from Aeolos and Iweco
amounting to EUR9,472,000, EUR629,000, and EUR277,000.  The
amounts of receivables from Aeolos and Iweco to be assigned to
Crete Hellas by EWD, EW, and EWHS, are EUR2,182,000, EUR159,000,
and EUR59,000, all of which will be capitalized by Crete Hellas
and converted to equity.

Mr. Sosland points out that EWD, EW and EWHS are likely to
receive a greater return on their receivables from Aeolos and
Iweco after the recapitalization than they would if the
recapitalization did not occur because:

   (a) if the recapitalization is not completed, the Greek
       operating licenses will be revoked, resulting in a
       realization of only EUR810,000 from a liquidation of the
       wind power projects, which is not sufficient to pay the
       entire secured loan amount owed to HVB and therefore, no
       funds would be available to satisfy the amounts owed to
       the Debtors, EWHS or Crete Hellas; and

   (b) in the alternative, if the power projects are sold as a
       going concern, the Debtors estimate that EUR9,900,000 of
       proceeds can be realized for the wind power projects,
       giving EUR7,000,000 of proceeds available after
       satisfaction of the HVB for distribution on a pro rata
       basis to the Debtors and EWHS -- a recovery of 62.5% of
       the original loan amounts.

Accordingly, the Debtors seek the Court's authority, pursuant to
Section 363 of the Bankruptcy Code, to take the necessary actions
to permit the recapitalization of Aeolos and Iweco, including the
assignment of a portion of the intercompany receivables owed to
the Debtors by Aeolos and Iweco to Crete Hellas amounting to
EUR2,341,000, in exchange for receivables from Crete Hellas.
(Enron Bankruptcy News, Issue No. 77; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


FEDERAL-MOGUL: Wants to Pull Plug on Forklift Equipment Leases
--------------------------------------------------------------
Federal-Mogul Corporation and its debtor-affiliates seek the
Court's authority to reject their master lease agreements and
schedules with nine forklift lessors:

   (1) Parker & Company,
   (2) Crown Equipment Corporation,
   (3) OKI Indianapolis,
   (4) The Bailey Company,
   (5) Citicorp Del-Lease Inc.,
   (6) Caterpillar,
   (7) Toyota Motor Credit Corporation,
   (8) Wiese Inc., and
   (9) Weise [sic] Planning and Engineering.

Currently, 850 forklifts are used in the Debtors' facilities
throughout North America and 230 of these forklifts are leased
while the Debtors own the rest.  The Debtors estimate that the
annual payment of the Old Forklift Leases aggregates to
$1,900,000.              

In lieu of the Old Forklift Leases, the Debtors selected Hyster
Capital, also known as NMHG Financial Services, Inc., and Hyster
Company to replace the existing forklift equipment with newer
versions at a lower cost for an anticipated $900,000 annual cost
savings.  The Debtors commenced the selection process by entering
into discussions with the leading forklift providers represented
by 13 large suppliers to discuss a comprehensive agreement to
provide the forklifts for use of all of the Debtors' North
American facilities.  After negotiations, the Debtors determined
that Hyster is the only supplier capable of fulfilling their
needs.

To facilitate the orderly replacement of the forklifts currently
in place, and to minimize the cost, the Debtors intend to:

(a) notify a particular Forklift Lessor of the rejection of the
    Old Forklift Lease and the date that the leased forklift
    equipment will be available for retrieval;

(b) notify the Forklift Lessor of the replacement of the forklift
    equipment contained on a particular lease schedule;

(c) have the rejections effective ten business days after a
    Forklift Lessor receives notice of the rejection and the
    available date of retrieval; and

(d) cease paying rent on an administration basis, 10 days on the
    effective Rejection Date. (Federal-Mogul Bankruptcy News,
    Issue No. 41; Bankruptcy Creditors' Service, Inc., 609/392-
    0900)


FRONTLINE COMMS: Needs Fresh Funds to Satisfy Debt Obligations
--------------------------------------------------------------
Frontline Communications Corp. (AMEX: FNT) -- http://www.fcc.net
-- announced financial results for the three months and six months
ended June 30, 2003.

Revenues for the three months ended June 30, 2003 increased by
1,498.5% to $20,571,986 compared with revenues of $1,286,961 for
the three months ended June 30, 2002. For the three months ended
June 30, 2003, after recognizing a $449,850 gain on debt
settlement and recording a noncash compensation charge of
$750,622, the net loss increased by $736,928 to $941,544 compared
to a net loss of $204,616 in the comparable period in 2002. For
the three months ended June 30, 2003, after adjusting for
preferred stock dividends, the net loss available to common
shareholders was $1,016,011, compared to $280,051 in the
comparable period in 2002.

Revenues for the six months ended June 30, 2003 increased by
719.9% to $21,638,113 compared with revenues of $2,639,230 for the
six months ended June 30, 2002. For the six months ended June 30,
2003, after recognizing a $449,850 gain on settlement and
recording a noncash compensation charge of $750,622, the net loss
increased by $720,571 to $1,139,371 compared to a net loss of
$418,800 in the comparable period in 2002. For the six months
ended June 30, 2003, after adjusting for preferred stock
dividends, the net loss available to common shareholders was
$1,288,305, compared to $573,300 in the comparable period in 2002.

"We are very pleased with Frontline's progress so far and are
confident that this is the beginning of the Company's next growth
phase," commented Stephen J. Cole-Hatchard, Chief Executive
Officer. "We have been working hard on the consolidation and are
very excited about the planned launch of our cash card and payroll
card operations."

The Provo division -- http://www.provo.com.mx-- acquired by  
Frontline Communications Corp. in April, 2003, is a Mexican
corporation which maintains a dominant position within the prepaid
calling card and cellular phone airtime markets in Mexico. Provo
and its affiliates have been in operation for over seven years,
and had combined audited revenue in 2002 of approximately $100
million, with operating profits of over $800,000. The company
currently anticipates expanding existing Provo services to the
continental United States, and intends to begin marketing cash
cards, payroll cards and other forms of payroll and money transfer
services, through both the Frontline and Provo divisions, in the
near future.

Founded in 1995, Frontline Communications Corporation provides
high-quality Internet access and Web development and hosting
services to homes and businesses nationwide. Frontline offers
Ecommerce, programming, and Web development services through its
PlanetMedia group, http://www.pnetmedia.com  Frontline is  
headquartered in Pearl River, New York, and is traded on the
American Stock Exchange.

                 Liquidity and Capital Resources

In its Form 10-Q for the quarter ended June 30, 2003, the Company
reported:

"Our working capital at June 30, 2003 was $747,463 compared with a
working capital deficiency of $2,655,722 at December 31, 2002. The
increase in working capital was primarily due to approximately  
$3.6 million of additional working capital that resulted from the
Provo acquisition.

"Our primary capital requirements are to fund Provo's working
capital. To date, we have financed our capital requirements
primarily through issuance of debt and equity securities.  The
availability of capital resources is dependent upon many factors,  
including, but not limited to, prevailing market conditions,
interest rates, and our financial condition.

"At June 30, 2003, Provo had aggregate borrowings of $ 1,917,792
under four lines of credit with two banks.  The lines are secured
by real estate owned by family  members of Provo's former  
majority  stockholders . At June 30, 2003, the current  interest  
rates on the lines range  between 9.5% and 10%. The lines expire
at various dates between July 2004 and  September of 2005 and one
line requires a monthly payment of approximately $14,000 in 2003.

"Historically, Provo relied on Telmex to finance its inventory
purchases with a line of credit. In March of 2003, Provo
restructured its credit line with Telmex.  At June 30, 2003,  we
owe Telmex  approximately  $7.4  million.  Of the balance,  
approximately $ 3.8 is payable in September of 2003 and the
balance of $3.6 million will be payable in 54 monthly  
installments commencing in July of 2003.

In April 2003, the Company borrowed $550,000 from an unaffiliated
entity and issued a secured  promissory  note to the Lender.  The
Note bears interest at the rate of 14% per annum and is secured by
substantially all of the Company's  assets.  Two officers have
pledged shares of the Company's common stock owned by them to the
Lender as additional collateral. The Note was payable on July 2,
2003 and by mutual agreement, the repayment date was extended to
August 1, 2003.  The Company is currently negotiating with the
Lender to extend the repayment date.

"We plan to raise additional financing.  The availability of
capital resources is dependent upon prevailing market conditions,
interest rates and our financial condition.  In July 2003, we
entered into a common stock purchase agreement with Fusion Capital
Fund II, LLC, whereby, Fusion Capital has agreed to purchase up to
$13 million of our common stock over a 40-month period.  The
transaction is subject to satisfaction of several conditions and
there can be no assurance that we will in fact complete the
transaction.

"Based on current plans, management anticipates that the cash on
hand, cash flow from operations and vendor credit will satisfy  
our capital requirements through at least the end of 2003, apart  
from our capital requirements relating to the following debt
obligations.  Our agreement with Telmex requires us to repay  
Telmex $3.8 million in September of 2003.  In addition, we are
required to repay $550,000 due under bridge financing on
August 1, 2003. We currently lack the funds to pay these  
obligations  when they become due.  Therefore, in order to satisfy  
our debt obligations, we are currently pursuing additional sources
of financing.  There can be no assurance, however, that such
financing will be available on terms that are acceptable to us, or
on any terms."


GENERAL MEDIA: Wants Access to $3 Million Interim DIP Financing
---------------------------------------------------------------
General Media, Inc., and its debtor-affiliates are seeking
approval from the U.S. Bankruptcy Court for the Southern District
Of New York to incur postpetition secured financing from Madeleine
LLC, and grant security interest and superpriority claims.  As of
the Petition Date, the Debtors owed to Madeleine $39.9 million
principal amount outstanding.

Following intense negotiations, the Lenders agree to afford the
Debtors a financing facility consisting of cash advances and other
extensions of credit in an aggregate principal amount of up to
$3,000,000 upon entry of an interim order and up to $5,000,000
upon entry of a final order approving the facility.

Accordingly, the Debtors believe that postpetition financing in
the proposed amount is necessary and in the best interests of the
estates. The proposed DIP Facility, together with the Debtors'
proposed use of Cash Collateral, will not only enhance the
Debtors' liquidity, but will also provide vendors, suppliers and
customers with confidence that the Debtors have sufficient
resources available to operate in the ordinary course of business.
Accordingly, absent entry of the Interim Order, the Debtors'
estates will be immediately and irreparably harmed.

In connection with their restructuring efforts, the Debtors report
that they considered various sources of postpetition financing
from other lenders. The Debtors however, are unable to obtain
adequate unsecured credit allowable under section 503 of the Code
as an administrative expense and are unable to obtain, within the
time required by their needs to avoid immediate and irreparable
harm, other financing under section 364(c) of the Code on equal or
more favorable terms than the DIP Loan Agreement.

After considering all alternatives, the Debtors have concluded in
the exercise of their prudent business judgment that the DIP
Facility represents the best working capital financing available
to them and that the financing proposal from Lenders is
competitive and addresses their working capital needs.

The DIP Loan will mature on the earliest of:

     i) February 12, 2004,

    ii) the date of the substantial consummation of a plan of
        reorganization,

   iii) 30 days after the Interim Facility Effective Date if the
        Final Bankruptcy Court Order has not been entered by the
        Bankruptcy Court on such date, and

    iv) such earlier date on which all Loans become due and
        payable in accordance with the terms of the Loan
        Documents.

The Debtors will pay the Lenders:

     1) a non-refundable DIP fee of $142,000; and

     2) an unused line fee, which shall accrue at 0.5% per annum
        on the excess, if any, of the Total Commitment over the
        sum of the average principal amount of all Loans
        outstanding from time to time;

General Media Inc., headquartered in New York, New York, is a
subsidiary of Penthouse International, Inc., publishes Penthouse
magazine and other publications and is engaged in other
diversified media and entertainment businesses.  Robert J.
Feinstein, Esq., and David J. Barton, Esq., at Pachulski, Stang,
Ziehl, Young, Jones & Weintraub PC represent the Debtors in their
restructuring efforts.  The Company filed for chapter 11
protection on August 12, 2003 (Bankr. S.D.N.Y. Case No. 03-15078).  
When the Company filed for protection from its creditors, it
listed estimated debts and assets of over $50 million each.


GENTEK INC: Court Disallows 10 Claims Totaling $37 Million
----------------------------------------------------------
GenTek Inc., and its debtor-affiliates have identified 10 claims
that duplicate the liability in the master proofs of claim filed
against them by:

   -- the Law Debenture Trust Company of New York, as Indenture
      Trustee, on behalf of the noteholders under the Series A
      and Series B Senior Subordinated Notes Due 2009; or

   -- JPMorgan Chase Bank, as administrative agent for the banks
      and other financial institutions who are parties to the
      Credit Agreement dated as of April 30, 1999 and amended and
      restated as of August 1, 2001.

The Claimants with respect to seven of the Duplicate Liability
Claims had a master proof of claim filed on their behalf by Law
Debenture pursuant to the terms of the Indenture.  The Claimants
with respect to the other three Duplicate Liability Claims had a
master proof of claim filed on their behalf by JPMorgan pursuant
to the Cash Collateral Order.  The Cash Collateral Order
authorized JPMorgan to file a master proof of claim on the
Lenders' behalf and provided that each Lender will be deemed to
have filed a proof of claim in respect to claims arising from the
Loan Documents.  The Duplicate Liability Claims aggregate
$37,347,897.

Consequently, the Court disallowed and expunged the 10 Duplicate
Liability Claims in their entirety.  The Debtors will retain
Claim No. 375 on account of the seven Duplicate Liability Claims
and Claim No. 3130 on account of the three other Duplicate
Liability Claims.

                          Disallowed   Disallowed     Remaining
Claimant                  Claim No.    Claim Amount   Claim No.
--------                  ----------   ------------   ---------
Carlyle High Yield            2546     $6,882,171        3130
Norse CBO, Ltd.               2622      2,932,495        3130
PPM Spyglass Funding          1941      4,819,987        3130
Forte CDO                     1692      4,575,951         375
Forte CDO II                  1691      4,306,777         375
Keightley, William            1976        250,000         375
ML CBO XXV Series             1694      5,383,472         375
Strong Advisor                1695        161,975         375
Strong High Yield             1696      5,235,661         375
Strong High Yield CBO         1693      2,799,405         375
(GenTek Bankruptcy News, Issue No. 18; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


GOLDEN EAGLE INT'L: Ability to Continue Operations Uncertain
------------------------------------------------------------
Golden Eagle International, Inc. was incorporated in Colorado on
July 21, 1988. It is a mining enterprise in the exploration stage.
Since inception, it has been engaged in organizational activities,
acquiring, developing, and operating gold, and other mineral
properties and starting in the fourth quarter 2002, mining gold
bearing ore and producing gold for market. The Company has had
significant production and has generated revenue through gold
sales, but to date has not achieved positive cash flow from mining
operations. Presently, substantially all of its current operations
are focused on two prospects in the Republic of Bolivia, which are
wholly owned by Golden Eagle: the combined Cangalli gold
properties and the Tipuani Valley gold properties. The Company
also is now focusing on its prospects in the Precambrian Shield
area of eastern Bolivia. In September 2002, Golden Eagle began
mining operations at its Cangalli gold mine. During the fourth
quarter 2002, a total of 92,700 tons of gold bearing ore were
mined and processed.

During the first and second quarters of 2003, totals of 84,100 and
89,150 tons respectively of gold bearing ore were mined and
processed. To the end of the second quarter, June 30, 2003, Golden
Eagle had produced 118,112 grams, or 3,797 troy ounces of gold,
with a market value of $1,156,403, although to the end of the
second quarter it had only sold gold with a value of $782,945. As
indicated, some of Golden Eagle's gold was held in inventory at
the end of the second quarter. Inventory represents mined and
processed gold concentrates and ore. Inventory is stated at the
lower of average production cost or net realizable value. Revenue
is recognized when the price is determinable, and upon delivery
and transfer of title of the gold to the customer.

The financial statements of Golden Eagle International, Inc. have
been prepared assuming Golden Eagle will continue as a going
concern, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business.
However, the Company had stockholders' deficits of $3,415,006 and
$4,839,093, respectively, as of June 30, 2003 and June 30, 2002,
and has incurred substantial losses of $32,970,585 since
inception. The Company presently has one producing plant and mine
that are not operating on a break-even basis. To further develop
the mine and plant will require significant additional financing
to satisfy outstanding obligations and to increase production
levels. Unless Golden Eagle successfully obtains suitable
significant additional financing arrangements, or begins
generating sufficient revenues from its mining operations, there
is a concern about its ability to continue as a going concern.

The Company's plans to address these matters include the use of
private placements of its stock in reliance on exemptions to
registration found in Sections 4(2) and 4(6) of the Securities Act
of 1933, obtaining short-term loans, seeking suitable joint
venture relationships, and by increasing the production levels at
its existing operation and commencing mining operations at other
claims owned by it or on properties to be acquired by it.


GOODYEAR TIRE: Enters 3-Year Tentative Labor Agreement with USWA
----------------------------------------------------------------
Following more than four days and nights of virtually non-stop
bargaining and analysis, The Goodyear Tire & Rubber Company (NYSE:
GT) and the United Steelworkers of America reached tentative
agreement on a new three-year master contract.

Jim Allen, Goodyear's director of global labor relations, said the
tentative agreement must be approved by the local union
membership.

"This tentative agreement reflects a tremendous amount of work by
the company and union," Allen said.  "It's a balanced document
that supports the business turnaround needs of the company,
strengthens our relationship with the USWA and addresses the key
concerns of its members and retirees."

Details of the proposed agreement will not be available until the
union has the opportunity to share the information with its
members.  Ratification votes by the more than 16,000 employees at
the 14 plants that participate in master bargaining will be
scheduled at the facilities in the near future.

The facilities are located in Akron, Marysville and St. Marys,
Ohio; Union City, Tenn.; Topeka, Kan.; Danville, Va.; Lincoln,
Neb.; Sun Prairie, Wis.; Gadsden and Huntsville, Ala.; Buffalo,
N.Y.; Fayetteville, N.C.; Freeport, Ill., and Tyler, Texas.

Shortly before the original master contract was due to expire on
April 19, the company and union agreed to a day-to-day extension.  
The parties have been negotiating since the second week of March.

Goodyear is the world's largest tire company.  Headquartered in
Akron, Ohio, the company manufactures tires, engineered rubber
products and chemicals in more than 85 facilities in 28 countries.
It has marketing operations in almost every country around the
world.  Goodyear employs about 92,000 people worldwide.  For more
information about the company, visit http://www.goodyear.comon
the Internet.

As reported in Troubled Company Reporter's July 2, 2003 edition,
Fitch Ratings placed the Goodyear Tire & Rubber Company's senior
unsecured rating of 'B' and the senior secured bank facilities
rating of 'B+' on Rating Watch Negative. Approximately, $5 billion
of debt is affected.


GOODYEAR TIRE: USWA Confirms Tentative Agreement with Company
-------------------------------------------------------------
The United Steelworkers of America has reached a tentative
agreement with Goodyear Tire and Rubber. The proposed master
contract covers more than 19,000 members at 14 locations across
the U.S.

Details of the proposed contract will be provided to the entire
membership and informational meetings will be conducted prior to
ratification votes being conducted at each plant.

New contract talks began March 12, 2003 in Cincinnati. The current
three-year contract was set to expire on April 19, 2003 at the
nine Goodyear and two Dunlop plants and on July 6, 2003 at the
three Kelly-Springfield facilities. Prior to the deadlines both
parties entered into day-to-day contract extension agreements.

The local unions involved in the contract negotiations include:

   * Goodyear Local 2 - Akron/Green, Ohio
   * Goodyear Local 12 - Gadsden, Alabama
   * Dunlop Local 135 - Buffalo, New York
   * Goodyear Local 200 - St. Marys, Ohio
   * Goodyear Local 286 - Lincoln, Nebraska
   * Goodyear Local 307 - Topeka, Kansas
   * Kelly-Springfield Local 745 - Freeport, Illinois
   * Kelly-Springfield Local 746 - Tyler, Texas
   * Goodyear Local 831 - Danville, Virginia
   * Goodyear Local 843 - Marysville, Ohio
   * Goodyear Local 878 - Union City, Tennessee
   * Goodyear Local 904 - Sun Prairie, Wisconsin
   * Dunlop Local 915 - Huntsville, Alabama
   * Kelly-Springfield Local 959 - Fayetteville, North Carolina

The USWA represents 1.2 million active and retired members in
North America, including nearly 90,000 active workers in the
rubber and plastics industry. Headquartered in Pittsburgh, the
USWA has 12 districts spanning the continent and more than 2,000
locals.

Goodyear is the world's largest tire company.  Headquartered in
Akron, Ohio, the company manufactures tires, engineered rubber
products and chemicals in more than 85 facilities in 28 countries.
It has marketing operations in almost every country around the
world.  Goodyear employs about 92,000 people worldwide.  For more
information about the company, visit http://www.goodyear.comon
the Internet.

As reported in Troubled Company Reporter's July 2, 2003 edition,
Fitch Ratings placed the Goodyear Tire & Rubber Company's senior
unsecured rating of 'B' and the senior secured bank facilities
rating of 'B+' on Rating Watch Negative. Approximately, $5 billion
of debt is affected.


HAYES LEMMERZ: HLI Trust Wants Neuberger to Present Documents
-------------------------------------------------------------
On September 29, 2000, the Debtors entered into a stock purchase
agreement under which Neuberger Berman LLC clients sold 436,500
shares of HLI common stock to the Hayes Lemmerz Debtors for
$5,456,250.  In accordance with its function to pursue and settle
the Trust Claims, the HLI Creditor Trust now wants to assess what
assets, if any, may be recoverable from Neuberger clients relating
to the stock repurchase transactions.

The HLI Creditor Trust was created pursuant to the Modified
Reorganization Plan.  The Trust's assets include the Trust
Claims.  Trust Claims are defined in the Modified Plan to include
causes of action against persons arising under Sections 502, 510,
541 through 545, 547 through 551 and 553 of the Bankruptcy Code
or under related state or federal statues and common law.

By this motion, the Trust asks Judge Walrath to issue a subpoena
to compel the production of documents and oral testimony from
Neuberger.  The Trust wants to:

   (a) determine the names and addresses of the Neuberger
       clients;

   (b) understand how the Debtors' cash was used; and

   (c) analyze what actions, if any, may be available to them.
       
J. Kate Stickles, Esq., at Saul Ewing LLP, Wilmington, Delaware,
contends that the information sought by the Trust, including the
examination of witnesses related to Neuberger, and dealings,
agreements, and transactions between or among Neuberger, its
clients and the Debtors is appropriate and within the scope and
purposes of Rule 2004 of the Federal Rules of Bankruptcy
Procedure, which provides:

   (a) Examination on Motion

       On motion of any party-in-interest, the court may order
       the examination of any entity.

   (b) Scope of Examination

       The examination of an entity under Rule 2004 or of the
       debtor under Section 343 of the Bankruptcy Code may relate
       only to the acts, conduct, or property, or to the
       liabilities and financial condition of the debtor, or to
       any matter which may affect the administration of the
       debtor's estate, or to the debtors' right to a discharge.

   (c) Compelling Attendance and Production of Documentary
       Evidence

       The attendance of an entity for examination and the
       production of documentary evidence may be compelled in the
       manner provided in Bankruptcy Rule 9016 for the attendance
       of witnesses at a hearing or trial.

Ms. Stickles asserts that investigation and pursuit of the Trust
Avoidance Actions requires a detailed analysis of the stock
repurchase transactions between the Debtors and the Neuberger
Berman clients.  Therefore, the Court should allow the Trust to
subpoena Neuberger pursuant to Rule 2004. (Hayes Lemmerz
Bankruptcy News, Issue No. 37; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


INAMED CORP: S&P Assigns BB- Rating to $100M Senior Secured Debt
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' senior
secured debt rating to medical products manufacturer Inamed
Corp.'s $100 million credit facility. At the same time, Standard &
Poor's affirmed its 'BB-' corporate credit rating on Inamed. The
outlook is positive.

The credit facility consists of a $65 million senior secured term
loan and a $35 million senior secured revolving credit facility,
both of which mature in 2008. The new facility was used to
refinance Inamed's existing senior secured notes, and it replaced
the company's former revolving credit facility.
     
Pro forma for the transaction, Inamed had approximately $65
million of debt outstanding as of July 31, 2003.
     
"The speculative-grade ratings on Inamed reflect its strong but
narrow market position and Standard & Poor's concern that the
company's operating performance may be affected by technological
risks and market changes," said credit analyst Jordan C. Grant.
     
Goleta, Calif.-based Inamed is a leading provider of medical
devices for the plastic- , reconstructive- , and esthetic-surgery
markets. The company is one of only two remaining U.S.
manufacturers of breast implants, holding about a 50% market share
in the U.S. and about 45% internationally. Regulatory requirements
for implants in the U.S. and the European Community, as well as
Inamed's dedicated sales force, (the largest in its market),
provide significant barriers to competitive entry. Inamed is also
a leading provider of facial implants.


IPCS INC: Committee Gratified by Ruling in Action vs. Sprint PCS
----------------------------------------------------------------
The Official Committee of Unsecured Creditors of iPCS Inc., issued
the following statement in response to a ruling by the Federal
Bankruptcy Court for the Northern District of Georgia granting the
Committee permission to commence its lawsuit against Sprint PCS:

"We are very gratified by the Court's ruling. As the Court made
clear, not only does the Committee have standing under the
Bankruptcy Code to bring these claims against Sprint PCS stemming
from Sprint's misuse of its domination and control over iPCS, but
the Court also found that these claims were colorable, thus
permitting this lawsuit to proceed. As the Court expressly stated,
the facts alleged by the Committee 'tend to show that the Sprint
Companies have been able to control the Debtors' finances,
pricing, credit policies and the general operation of the
business' of iPCS and also 'tend to suggest that the Sprint
Companies misused their control over the Debtors by essentially
rewriting the contracts to gain an unfair advantage over the
Debtors, by disregarding the terms of the contracts and refusing
to pay amounts owed to the Debtors, and by requiring the Debtors
to deal with the Sprint Companies on commercially unreasonable
terms.'

"We remain convinced that Sprint dominates and controls iPCS, and
that Sprint should be found liable for the damages that the
creditors have sustained as a result of Sprint's wrongful acts.
Sprint's actions have already cost iPCS's creditors hundreds of
millions of dollars. Indeed, as the Court recognized, 'the
potential financial recovery to the estates is significant.'"

"The Committee intends to vigorously pursue its claims against
Sprint PCS."

iPCS is the Sprint PCS affiliate that owns and operates the Sprint
PCS network in four Midwestern states and serves more than 220,000
customers.

The Official Committee of Unsecured Creditors represents the
interests of all unsecured creditors in the iPCS Chapter 11 case.
The Committee's financial advisors are Chanin Capital Partners
LLC, and its attorneys are Paul, Weiss, Rifkind, Wharton &
Garrison LLP and Powell, Goldstein, Frazer & Murphy LLP.


ITEX CORP: Anticipates Sizeable Loss for Fiscal 2003 4th Quarter
----------------------------------------------------------------
ITEX Corporation, (OTCBB:ITEX) a leading business services and
payment systems company, announced that the fourth quarter of
fiscal 2003, ending July 31, will show a loss, potentially
sizeable enough to create a loss for the entire year. Audited
numbers are expected to be released in late October with the
filing of the company's annual report on Form 10-KSB.

Steven White, chairman of the board stated, "Our core business
continues to be strong, as evidenced by the two most recent four
week billing cycles. Although the last cycle, ending Aug. 7, was
on par with the previous year, the cycle prior, ending July 10,
was our strongest cycle in four years on a comparable basis.
However, we were faced with a number of expense items that will
impact the fourth quarter. A number of unresolved legal issues
recently were uncovered by the new management and were dealt with
immediately. These legal settlement costs, coupled with the
residual effects of poor execution in several departments of our
business, caused us to suffer damage to earnings for the quarter."

White further stated, "Moving forward, our primary focus is to
elevate the Broker Network by working closely with them and
concurrently keep our corporate overhead low. We are taking all
necessary steps to protect and strengthen the company."

  ITEX Settles Several Lawsuits; Served by Former Executive

ITEX settled several outstanding lawsuits in the fourth quarter,
incurring over $100,000 in legal fees and settlements. The
settlements eliminated further legal costs and the potential
exposure to these cumulative claims, which was significantly
higher than the settlement amounts.

ITEX faces additional litigation claims as a result of the recent
restructuring of its executive management team. ITEX was recently
served with a lawsuit by a former executive for wrongful
termination, and has received a threat of litigation from two
other former executives. A dispute concerning accrued vacation pay
for two of these former executives may incur further costs,
including legal fees. ITEX plans to vigorously defend these
claims. The potential exposure to ITEX, including legal fees and
potential liability with payroll taxes, could total several
hundreds of thousands of dollars.

                   Staff and Overhead Reduced

The Company has reduced its corporate staff by thirty percent in
the past 60 days for a reduction in salaries from $160,000 to
approximately $100,000 per month. Of the salary reductions,
$20,000 was the result of the recent sale of offices in New York
and Toronto. The reductions were made possible by the increased
efficiency of our remaining staff, and were deemed necessary in
order to pay outstanding obligations and put the company on firmer
financial ground.

                   Franchise Expenses Reduced

Since the beginning of the fiscal year on Aug. 1, 2002, the
Company incurred more than $300,000 in marketing, labor, legal and
other costs associated with the franchise growth model. During the
same period, revenue generated from the franchising effort was
$32,500, derived from the sale of four new broker franchises.

ITEX has halted expenses relating to its franchise promotional
efforts. We continue to seek regulatory approval in California and
certain provinces in Canada. ITEX is currently qualified to sell
franchises in 49 of the 50 states.

Founded in 1982, ITEX Corporation -- http://www.itex.com-- is a  
business services and payment systems company processing over
$150,000,000 a year in transactions between member businesses.
ITEX assists its member businesses to increase sales, open new
markets and utilize the full business capacity of their
enterprises by providing a private currency through the company's
broker network and client base.

                         *     *     *

In its Form 10-QSB filed with the Securities and Exchange
Commission, ITEX Corporation reported (all amounts are expressed
in thousands of US$):

          Results for the Nine Months Ended April 30, 2003

"During the first nine months of fiscal 2003, we funded our
activities through operations. At April 30, 2003, we had
approximately $327 in cash and cash equivalents. We operate using
four week billing and payroll cycles. The timing difference
between the four week cycles and our reporting periods causes
fluctuations in cash, accounts receivable and broker commissions.
Cash and accounts receivable are primarily affected by the autopay
runs created from clients who have allowed us to retain their
credit card or checking account information. If an autopay run
falls near the end of a reporting period, it is likely our cash
balance will be higher and accounts receivable lower. Likewise,
if the autopay run falls subsequent to the reporting period, our
cash balance will be lower and accounts receivable higher.
Similarly, the timing of payroll, based on four week cycles, will
affect the balance in broker commissions payable.

"During the nine months ending April 30, 2003, we received net
cash from our operating activities of $199 as compared to net cash
used in operating activities of $360 for the nine months ending
April 30, 2002. The increase in net cash provided by our operating
activities is largely due to the significant decrease in operating
expenditures.

"During the nine months ending April 30, 2003, we received net
cash from investing activities of $26, resulting from proceeds
received from the sale of regional offices of $49, offset by the
purchase of fixed assets of $23. During the nine months ending
April 30, 2002, we reported net cash provided by investing
activities of $28, resulting from proceeds received from the sale
of securities of $56, offset by the purchase of fixed assets of
$28.

"During the nine months ending April 30, 2003, the net cash
provided by our financing activities was $5, resulting from the
exercise of stock options, compared to net cash used in financing
activities for the nine months ended April 30, 2002 of $372
related to payments made to Network Commerce for the purchase of
Ubarter.com during the previous fiscal year.

"During the nine months ending April 30, 2003 there was net cash
provided from the effective exchange rate on cash and cash
equivalents of $7 which did not exist in the prior fiscal year.

"At April 30, 2003, our working capital deficit was $732 compared
to a deficit of $1,328 at July 31, 2002. Management continues to
reduce overhead costs through increased operating efficiencies. In
addition, by divesting the corporate offices, as outlined in the
revenue section above, ITEX expects to yield additional cost
savings, which management believes will streamline operations and
save the company close to $1 million in overhead per year.
Reduction of overhead includes corporate savings with smaller
headcount and fewer office leases. In addition, by financing the
sale of the existing corporate stores, the company expects to be
able to realize an additional positive impact to earnings over the
next five years. At April 30, 2003, stockholders' equity increased
to $277 from $40 at July 31, 2002 primarily resulting from our net
income of $139 in the first nine months of fiscal 2003."


KAISER ALUMINUM: 6th Amendment to Credit Agreement Takes Effect
---------------------------------------------------------------
Kaiser Aluminum said the previously disclosed sixth amendment to
its existing Credit Agreement has become effective.

The sixth amendment increases availability by approximately $45
million and extends the term of the Credit Agreement by one year,
to February 2005. Although Kaiser is targeting emergence from
Chapter 11 in 2004, the company had sought a full one-year
extension of the Credit Agreement, in part, to provide customers
and suppliers with assurance that financing is committed well into
the future.

Kaiser Aluminum Corporation (OTCBB:KLUCQ) is a leading producer of
fabricated aluminum products, alumina, and primary aluminum.


KRATON POLYMERS: Ratings on Watch Pending Possible Company Sale
---------------------------------------------------------------
Standard & Poor's Ratings  Services has placed its 'BB-' corporate
credit rating on synthetic elastomers producer Kraton Polymers LLC
on CreditWatch with developing implications.

Houston, Texas-based Kraton has about $333 million of total debt
outstanding.
     
"The CreditWatch placement follows the disclosure in trade press
reports that majority owner, Ripplewood Holdings LLC, has engaged
two investment banks to explore the sale of Kraton Polymers," said
Standard & Poor's credit analyst Franco DiMartino. The sale
process is in the preliminary stages but could be completed by
year-end.  

"Accordingly," said Mr. DiMartino, "the ratings on Kraton could be
lowered, affirmed, or raised depending on the financial structure
of the proposed transaction". An acquisition of Kraton by a
company with a stronger credit profile could result in an upgrade.  
Conversely, an acquisition of Kraton by a company with a weaker
credit profile, or by a financial buyer using an aggressive debt
structure, could result in a downgrade.  Standard & Poor's would
expect that Kraton's existing debt would be refinanced if a
material change of control took place.
     
Kraton, with about $650 million in annual sales, is the leading
global producer of styrenic block copolymers.  SBCs offer
flexibility, resilience, strength, and durability to a wide range
of products in a number of end markets, including compounding and
polymer systems, adhesives and sealants, asphalt modification, and
footwear.
     
Standard & Poor's said that it will continue to monitor
developments and will resolve the CreditWatch as more information
is made available.


LTV: Copperweld Intends to Terminate and Replace Benefit Plans
--------------------------------------------------------------
Copperweld Corporation, Miami Acquisition Company, and Copperweld
Tubing Products Company, three of the Copperweld Debtors, ask
Judge Bodoh to:

       (1) determine that the Copperweld Debtors satisfy the
           financial requirements for a "distress termination"
           of their defined benefit pension plans under
           Section 4041(c)(2)(B) of ERISA;

       (2) approve the termination of the Salaried Plan
           effective September 30, 2003; and

       (3) authorize the Copperweld Debtors to provide a
           replacement benefit under a defined contribution
           arrangement, or other "acceptable arrangement."

The Copperweld Debtors remind Judge Bodoh that they have already
closed their facilities located in Birmingham, Alabama; Pawtucket,
Rhode Island; and Portland, Oregon.  The Copperweld Debtors
currently are in the process of closing their facilities located
in Piqua, Ohio and Bedford Park, Illinois.  

                         The Pension Plans

Copperweld sponsors the Copperweld Corporation Pension Plan for
the non-union hourly and salaried employees of Copperweld and
certain affiliated Debtors.  Miami sponsors the Pension Plan for
Miami Hourly Employees for its union employees at its Piqua, Ohio
plant.  CTPC sponsors the Copperweld Corporation Shelby Division
Pension Plan for Production and Maintenance Employees for its
unionized production and maintenance employees at its Shelby, Ohio
facility.  The Miami Hourly Plan and the Shelby Hourly Plan are
maintained in accordance with the Copperweld Debtors' collective
bargaining agreements with the United Steelworkers of America for
the Piqua and Shelby, Ohio, plants, which were renegotiated and
entered into postpetition.  The Piqua, Ohio, plant currently is
slated to close on September 30, 2003, with the termination of the
Miami Hourly Plan on that date.

                           The Business Plan

The Copperweld Debtors and their affiliates have recently
completed the development of a revised long-term business plan
that serves as the cornerstone of their plan of reorganization.  
They have shared the Business Plan and its underlying assumptions
with their postpetition lenders, the professionals for the
Noteholders' Committee, the Pension Benefit Guaranty Corporation,
and the USWA.

Unfortunately, over the past year, the Copperweld Debtors'
business has performed poorly.  For example, for the fiscal year
ended December 31, 2002, Copperweld and its affiliates experienced
a $205,000,000 net loss.  For the fiscal year ending 2003,
Copperweld predicts a decrease of approximately $50,000,000 in
sales and a $78,700,000 net loss.  These results are reflective of
industries that remain depressed.  The Copperweld Debtors estimate
that the total consumption of tubular products in North America
has declined from 6,600,000 tons in 2000 to an estimated 5,300,000
tons in 2003.  Over the same period, the Copperweld Debtors
estimate that the available market in the United States for
bimetallic products has declined nearly 70%.  The Business Plan
reflects this difficult operating environment and, hence, utilizes
reasonable assumptions regarding, among other things, projected
future sales growth and improvement in industry conditions.  The
Copperweld Debtors have projected a realistic plan for stabilizing
the business, returning it to profitability and attaining growth
in sales and earnings over the next five years in light of current
and anticipated industry conditions.

                        Cost-Cutting and Results

The Business Plan is, therefore, predicated on a number of cost-
cutting measures, including, among others, closing certain plants,
moving certain manufacturing functions to other facilities,
increasing employee premium contributions for health care and
reducing personnel -- both hourly and salaried.  As a result of
these and other measures, in fiscal year 2004, the first year of
the restructuring, the Copperweld Debtors and non-debtor
affiliates expect to increase their EBITDA by $33,000,000 over
2003's projected negative EBITDA of $2,500,000.  Further, the
reorganized Copperweld Debtors will emerge from Chapter 11 with a
new revolving exit financing facility -- currently projected to be
$90,000,000 -- to provide working capital to the reorganized
entities, and a secured term loan -- currently projected to be
$110,000,000 -- that will satisfy a portion of the Copperweld
Debtors' postpetition financing.  The lenders under these
facilities will expect to receive interest payments and some
amortization of their debt.  Indeed, given their current financial
situation and the bleak industry outlook, it is highly unlikely
that the Copperweld Debtors will be able to secure new or extended
credit without the ability to assure lenders that interest will be
paid and that principal will be amortized.

               Need for Termination of the Pension Plans

The restructuring presented in the Business Plan also assumes the
termination of the Pension Plans and the provision of a
replacement benefit under a defined contribution arrangement or
other acceptable arrangement for current, active employees.  
Because the financial projections in the Business Plan are
predicated on the assumption that the Pension Plans will be
terminated, they do not reflect the costs of future plan
contributions, which are otherwise scheduled to re-commence in
2004.

The Business Plan does reflect the cost of the Replacement Plans,
which is estimated to be approximately $2,700,000 annually.  
Absent termination of the Pension Plans, for the years 2003 to
2008, Copperweld will be required to make contributions to such
plans in the aggregate annual amounts of approximately:

               Amount        Year
               ------        ----
               $800,000      2003
             12,600,000      2004
             21,600,000      2005
             18,100,000      2006
             14,900,000      2007
             12,000,000      2008

These amounts, which total $80,000,000, exclude additional annual
contributions of approximately $8,000,000 that Copperweld must
make to fund the pension plans for its non-debtor affiliate
Copperweld Canada Inc.  For the period 2003 through 2008, the
Copperweld Debtors' and their operational affiliates' consolidated
projected net income or loss is approximately:

               Amount        Year
               ------        ----
           $(78,700,000)     2003 -- excluding the Non-Cash Gain
              9,400,000      2004
              5,900,000      2005
             12,900,000      2006
             16,000,000      2007
             20,500,000      2008

Projected cash flow under the Business Plan will not support
continued funding of the Pension Plans.  The Copperweld Debtors
anticipate that, without any funding of the Pension Plans, cash
flow will approximate:

               Amount        Year
               ------        ----
           $(10,200,000)     2003
              2,900,000      2004
               (500,000)     2005
                      0      2006
               (300,000)     2007
                300,000      2008

Over the 2004 to 2008 time period, these cash flows include
aggregate senior debt repayments totaling $29,000,000 of the total
projected senior debt amount for the reorganized Copperweld
Debtors of $110,000,000.  Cash flow with continued pension funding
is consistently negative:

               Amount        Year
               ------        ----
           $(11,000,000)     2003 -- without giving effect to
                                     the Potential Inter-Debtor
                                     Settlement
             (7,400,000)     2004
            (21,100,000)     2005
            (19,100,000)     2006
            (18,100,000)     2007
            (16,400,000)     2008

Similarly, for the period 2003 through 2008, the Copperweld
Debtors' and their operational affiliates' consolidated projected
EBITDA absent continued funding of the Pension Plans is
approximately:

               Amount        Year
               ------        ----
            $(2,500,000)     2003
             30,500,000      2004
             39,700,000      2005
             46,500,000      2006
             51,800,000      2007
             58,400,000      2008

The amounts available for debt service over a five-year period
from 2004 to 2008 are approximately:

               Amount        Year
               ------        ----
            $21,400,000      2004
             12,100,000      2005
             17,600,000      2006
             18,300,000      2007
             24,900,000      2008

Amortization of senior debt principal is scheduled to begin in
2004 -- assuming the receipt of a U.S. tax refund of $8,000,000.  
There is no debt amortization in 2005; debt repayment resumes in
2006.

                      Alternatives Considered

In light of their daunting funding obligations over the next
several years, the Copperweld Debtors, in conjunction with their
advisors, sought ways to reduce their pension costs short of
terminating the Pension Plans.  The Copperweld Debtors considered:

     (a) maintaining the Pension Plans but nullifying certain
         improvements recently made, or agreed to be made upon
         emergence from bankruptcy, to the Pension Plans as a
         result of the postpetition collective bargaining
         negotiations with the USWA;

     (b) "freezing" the Pension Plans -- i.e., eliminating
         future benefit accruals -- as of September 30, 2003,
         and instituting the Replacement Plans for post-freeze
         periods; and

     (c) seeking funding waivers from the IRS for 2003, 2004
         and 2005.

None of these alternatives proved to be feasible.  First,
maintaining the Pension Plans but nullifying certain improvements
recently made to the Shelby Hourly Plan would save only
$10,000,000 over the five-year period from 2004 through 2008 and
continues an aggregate cost of $69,000,000 to the reorganized
Copperweld Debtors' estates over the five-year period.  These
savings are insufficient to support the success of the Business
Plan because they did not generate sufficient funds to provide
future lenders with adequate assurances that post-reorganization
debt could be amortized.

Second, using normal, ongoing assumptions, "freezing" the Pension
Plans as of September 30, 2003, with nullified improvements and
instituting the Replacement Plans for post-freeze periods would
only result in projected savings of $11,000,000 over the five-year
period from 2004 to 2008 when the cost of the Replacement Plans is
added, for an aggregate cost of $68,000,000 to the reorganized
Copperweld Debtors' estates over the five-year period.  Under this
alternative, projected cash flows cannot support the required
payments.

Finally, under current ERISA regulations, the IRS is not
authorized to grant advance deferrals or waivers of future pension
funding contributions.  A waiver application should not be filed
until after the beginning of the year for which the contributions
sought to be waived are due, and there can be no assurance that a
waiver would be granted in any given year.  Moreover, waivers may
only be granted for three of any 15 plan years.  In addition, each
waived funding deficiency must be amortized over a period of five
plan years, with interest at 150% of the federal mid-term rate.  
The result is that, not only must contributions be made in the
near future, but funding would fall in the 2006 to 2008 period in
which the amortization of the post-reorganization term loan would
re-commence, resulting in an inability of the Copperweld Debtors
to both repay the loan and make the funding contributions.

Specifically, the Debtors project that $13,000,000 in pension
funding would be due in 2005, $23,900,000 due in 2006, $20,800,000
in 2007, and $17,700,000 in 2008 if funding waivers were obtained
for 2003, 2004 and 2005, based on normal, ongoing return on asset
assumptions of 8.5% each year.  Based on pessimistic return on
asset assumptions, $16,100,000 in pension funding would be due in
2005; $31,800,000 would be due in 2006; $29,400,000 in 2007; and
$25,400,000 in 2008.  Even if funding waivers for the years 2003
to 2005 could be obtained, however, projected cash flow cannot
support the required payments under normal, ongoing assumptions
regarding the return on pension assets.  In addition to the
waivers in the initial years being insufficient, the Copperweld
Debtors would have to "make up" the contributions in the later
years, further eroding cash flow.

                   Cost of Termination and Replacement

In contrast, the Copperweld Debtors estimate that the cost to
their estates of terminating the Pension Plans and implementing
the Replacement Plans is $13,500,000 over the five-year period
from 2004 through 2008 -- a savings of approximately $66,500,000
over the current Pension Plan cost forecast.  Accordingly, the
Copperweld Debtors have determined that this option is the best
alternative available to ensure the success of the Business Plan
and their ultimate reorganization.

The Copperweld Debtors admit that, "[i]n fact, the Business Plan
is not feasible absent termination of the Pension Plans.  To
prepare for the possibility that the Pension Plans cannot be
terminated, management is developing a contingency plan of
liquidation for the Copperweld Debtors."

                 Termination of the Plans is Warranted

The Copperweld Debtors satisfy each of the requirements for
termination.  First, each of them is currently a debtor under
Chapter 11 of the Bankruptcy Code.  Second, the Copperweld Debtors
have previously met with the PBGC to discuss the proposed
termination of the Pension Plans.  Finally, the Copperweld Debtors
and the members of their controlled group meet the financial
necessity prong of the test.  Specifically, the Copperweld Debtors
and their operational affiliates -- including their non-debtor
operational affiliates, which are included in the Business Plan --
will not be able to pay all of their debts pursuant to a plan of
reorganization and continue in business outside the reorganization
process unless the Pension Plans are terminated.  All of the other
members of the Copperweld Debtors' controlled group have
liquidated substantially all of their assets and are in the
process of winding up their estates or corporate existence, as
applicable.  Accordingly, such members will be unable to generate
cash to satisfy the Copperweld Debtors' future funding
requirements under the Pension Plans.

The Debtors tell Judge Bodoh that "efforts over the past two years
to market and sell the Copperweld Debtors' assets failed to
generate bids sufficient to retire such Debtors' postpetition
debt.  Accordingly, the Copperweld Debtors and their creditors
determined that a sale of assets should not be pursued."

To comply with the requirement that the plan administrator provide
a Notice of Intent to Terminate to each person who is an affected
person at least 60, but not more than 90, days prior to the
proposed termination date, on July 7, 2003 -- which is 85 days
before the proposed termination date of September 30, 2003, the
Copperweld Debtors sent a NOIT to all affected parties in the
Salaried Plan.

Finally, the Copperweld Debtors' current CBAs require the
maintenance of the Miami Hourly Plan and the Shelby Hourly Plan.  
The Copperweld Debtors anticipate that the future disposition of
the Miami Hourly Plan and the Shelby Hourly Plan will be
determined in discussions between them and the USWA.  The
Copperweld Debtors have been engaged in discussions with the USWA
regarding the termination of these plans, and expect that
discussions will continue.  The Copperweld Debtors have held
preliminary discussions with the USWA and have responded to the
USWA's information requests.  The Copperweld Debtors hope to reach
an agreement with the USWA on the termination of such plans.  If
that occurs, the Copperweld Debtors will seek both a finding that
they meet the requirements for a distress termination and
authority to terminate the Miami Hourly Plan and the Shelby Hourly
Plan, as well as the Salaried Plan.  If that agreement does not
materialize, the Copperweld Debtors will seek a finding that they
meet the requirements for a distress termination of the Miami
Pension Plan and the Shelby Pension Plan.

                       The Replacement Plan

The Copperweld Debtors also seek the Court's permission to
implement the Replacement Plans, effective on the termination date
of the Pension Plans, or at such other date as the Copperweld
Debtors and the USWA might agree.  Negotiations about the
Replacement Plan are still ongoing.

The Copperweld Debtors assure Judge Bodoh that they understand the
hardship that the termination of the Pension Plans will create for
their current employees.  Accordingly, they have determined to
implement the Replacement Plans as an alternative benefit for
their employees and believe that this action is both a cost-
effective alternative and warranted under the circumstances.  
Implementation of the Replacement Plans will preserve employee
morale and enhance the reorganized Copperweld Debtors' ability to
retain their employees over the long-term. (LTV Bankruptcy News,
Issue No. 52; Bankruptcy Creditors' Service, Inc., 609/392-00900)


LUCILLE FARMS: 1st Quarter Results Reflect Business Improvement
---------------------------------------------------------------
Lucille Farms, Inc. (NASDAQ-LUCY) a manufacturer and marketer of
low moisture mozzarella cheese, low moisture mozzarella type
cheese products and shredded cheese, announced its results for the
first quarter ending June 30, 2003.

                                            Three Months Ended
                                                 June 30
                                               (unaudited)

                                          2003            2002

Net Sales                              $ 8,510         $ 9,318
Income/(loss) before                                  
Extraordinary Item                     $    22         $  (732)
                                                      
Extraordinary Item:                                   
Gain on Debt Restructuring                  --         $   875
Net (loss) Income                      $    22         $   143
Income (loss) per share                               
Before Extraordinary item              $   .01         $  (.23)
Extraordinary item                          --         $   .28
Net Income                             $   .01         $   .05
Diluted                                $   .01         $   .05
Shares basic                         3,284,775       3,118,109
Diluted                              3,284,775       3,920,639

Net income for the quarter ended June 30, 2003 was $22,000
compared to a Loss before Extraordinary Item of $732,000 for the
comparable quarter of the prior year. The net income of $22,000
reflects the continuation of an improving trend in the business of
the Company. The extent of the improvement in the first quarter is
highlighted by several factors including the effects of reduced
operating costs and improved productivity at the Company's cheese
plant. This result was achieved despite the fact that the block
cheddar cheese market as reported on the Chicago Mercantile
Exchange (CME Block Market) was $.08 lower ($l.14) than the
average price per pound for the first quarter of the previous year
($1.22). The Company's selling prices for its products, like
others in the industry, are a function of this market.

The improvement also was due to the efforts of Jay Rosengarten,
who was appointed as Chief Executive Officer in October 2002. The
Company is continuing to take steps to make its operations more
efficient, as well as, instituting a quality assurance program to
improve the quality of its products. In addition, the Company has
begun to implement a selling strategy designed to increase the
premiums it gets for its products and eliminate unprofitable
customers.

These steps will place the Company in a position to take advantage
of a higher CME Market. The Company can report that since the
beginning of July 2003 the CME has moved higher.

                             *    *    *

                  Liquidity and Capital Resources

In its Form 10-Q for the quarter ended June 30, 2003, Lucille
Farms reported:

"The Company has available a $4,000,000 revolving credit faculty
at June 30, 2003, which will mature on September 15, 2003 (with
St. Albans Cooperative participating therein to the extent of $
3,000,000) at which time the outstanding principal balance is due.
The rate of interest on amounts borrowed against the revolving
credit facility is based upon the New York prime rate plus
1% (5% at June 30, 2003). Advances under this facility are limited
to 50% of inventory (with a cap on inventory borrowing of
$1,000,000) and 80% of receivables as defined in the agreement.
The commitment contains various restricted covenants including
requiring the Company to generate an increase in its dollar amount
of net worth annually. The Company is seeking alternative
financing to replace this loan. Should the Company not be able to
secure alternative financing by the extended due date, it will
request an additional extension until such financing is secured.
However, there is no assurance that such financing can be secured
on the extension granted. Failure to secure financing can have a
significant negative effect on the Company's ability to fund
operational requirements.

"At June 30, 2003 the Company had negative working capital of
$627,000 as compared to negative working capital of $238,000 at
March 31, 2003. The Company's revolving bank line of credit is
available through September 15, 2003 for the Company's working
capital requirements.

"At June 30, 2003 $2,986,000 was outstanding under such revolving
credit line and $404,000 was available for additional borrowing.

"On February 8, 1999, a $4,950,000 bank loan agreement was signed.
The loan is collateralized by the Company's plant and equipment
and guaranteed by the USDA. Provisions of the loan are as follows:

     - $3,960,000 commercial term note with interest fixed at 9.75
       percent having an amortization period of 20 years with
       maturity in February, 2019.

     - $990,000 commercial term note with interest fixed at 10.75
       percent having an amortization period of 20 years with
       maturity in February 2019.

"On May 23, 2001, the Company entered into a new term loan with Co
Bank for $2,000,000 with interest payable at 1% above the rate of
interest established by the bank as its national variable rate.
$500,000 of such loan has been repaid and the balance is repayable
in three consecutive annual installments of $500,000 with the next
installment due on May 1, 2004. The loan is collateralized by the
Company's plant and equipment and was used for working capital.

"On May 16, 2002, Lucille Farms, Inc. entered into an agreement
with St. Albans Cooperative Creamery, Inc., the Company's primary
supplier of raw materials, pursuant to which St. Albans (i)
converted $1,000,000 of accounts payable owed by Lucille Farms to
St. Albans into 333,333 shares of common stock, (ii) converted
$3,500,000 of accounts payable owed by Lucille Farms to St. Albans
into (A) preferred stock convertible into 583,333 shares of common
stock, which preferred stock (1) automatically converts into such
number of shares of common stock if the common stock is $8.00 or
higher for 30 consecutive trading days, and (2) may be redeemed by
Lucille Farms for $3,500,000, and (B) a 10-year warrant to
purchase 583,333 shares of common stock (subject to adjustment
under certain circumstances to a maximum of 1,416,667 shares of
common stock) at $.01 per share, which warrant (1) may not be
exercised for a period of three-years, (2) terminates if, during
such three-year period, Lucille Farms' common stock is $8.00 or
higher for 30 consecutive trading days, and, (3) in the event
Lucille Farms' common stock is not $8.00 or higher for 30
consecutive trading days during such three-year period, may only
be exercised on the same basis percentage wise as the preferred
shares are converted, (iii) converted an additional $1,000,000 of
accounts payable owed by Lucille Farms to St. Albans into a
convertible promissory note due on April 14, 2005, which note is
convertible into common stock at $6.00 per share at any time by
St. Albans and, at the option of Lucille Farms, automatically
shall be converted into common stock at $6.00 per share if the
common stock is $8.00 or higher for a period of 30 consecutive
trading days, and (iv) provided Lucille Farms with a pricing
structure for milk and milk by-products, for a minimum of one-year
and a maximum of four-years (subject to renegotiation at the
expiration of the applicable period), designed to produce
profitability for Lucille Farms.

"The Company's major source of external working capital financing
has been the revolving line of credit. For the foreseeable future
assuming the line is replaced, the Company believes that the
Company's revolving line of credit will continue to represent the
major source of working capital financing besides income generated
from operations. However, failure to secure such replacement
financing or extension can have a significant negative effect on
the Company's liquidity.

"For the three month period ended June 30, 2003, cash provided by
operating activities was $633,000. A profit from operations of
$22,000 increased cash. In addition, decreases in accounts
receivable of $169,000, prepaid expenses of $31,000 and other
assets of $100,000 and an increase in accounts payable of
$658,000 provided cash. While increases in inventory of $359,000
and a decrease in accrued expenses of $215,000 decreased cash.

"Net cash used by investing activities was $72,000 for the period
ended June 30, 2003, which represented purchase of property, plant
and equipment.

"Net cash used by financing activities was $519,000 for the period
ended June 30, 2003. Payments of the first installment to Co Bank
of $500,000 decreased cash.

"The Company presently is seeking to replace its $4,000,000
secured revolving credit line, the maturity of which has been
extended to September 15, 2003. The Company estimates that based
on current plans and its ability to replace or extend the
revolving line of credit, its resources, including revenues from
operations and utilization of its revolving credit lines, should
be sufficient to meet anticipated needs for at least 12 months.
Failure to secure such financing or receive such extension will
result in a significant negative effect on the Company's
liquidity."


MAGELLAN HEALTH: Overview of Third Amended Chapter 11 Plan
----------------------------------------------------------
Magellan Health Services, Inc., and its debtor-affiliates present
the Court with their Third Amended Plan and Disclosure Statement
dated August 18, 2003.  Mark S. Demilio, Executive Vice President
and Chief Finance Officer of the Debtors, relates that the
material modifications of the Plan include:

A. The estimated total equity value for Reorganized Magellan on
   the Effective Date is $242,100,000;

B. Classes 13 and 14, holders of Magellan Stock Interests, will
   be allowed to vote on the plan if Class 8, holders of Senior
   Subordinated Note Claim, and Class 9, holders of Other
   General Unsecured Claims, will not accept the Plan.  However,
   as a result of the operation of Section 1129 of the
   Bankruptcy Code, no distributions will be made to either
   Class 13 or 14 if either Class 8 or 9 does not accept the
   Plan;

C. The Debtors estimate that the Class 2 Claims total
   $1,000,000;

D. Unpaid Class 3 Claims as of the Effective Date is estimated to
   be $2,700,000;

E. Allowed holders of Class 8 Claims are estimated to receive
   8,997,664 shares of New Common Stock and have the right to
   purchase 2,428,067 shares of New Common Stock in the Equity
   Offering at a price of $28.50 per share;

F. The ultimate Allowed amount of Claims in Class 9 will be
   $69,400,000, based on:
   
                                                    Estimated
   Instrument                                    Allowed Amount
   ----------                                    --------------
   Ordinary course Claims from vendors and           $9,900,000
   suppliers

   Rejection Claims from executory contracts          4,000,000
   and unexpired leases

   Unclaimed Property Claims                         10,000,000
                                                  to 29,100,000    

   Litigation and other unliquidated Claims     0 to 46,600,000

   Other Claims                                       1,700,000

   It is estimated that for each holder of $1,000 Allowed Other
   General Unsecured Claim will receive:

   -- New Notes in the aggregate amount of $273;

   -- Cash in a minimum amount of $24.78;

   -- 9.8276 shares of New Common Stock, subject to the Partial
      Cash-out Election; and

   -- the right to participate in the Equity Subscription Rights;
  
G. The Debtors estimate that over 4,300 prepetition unsecured
   creditors have Claims of $500 or less.  For purposes of
   administrative convenience, and in accordance with Section
   1122(b) of the Bankruptcy Code, the Plan provides that each
   holder of an Other General Unsecured Claim whose Claim is
   allowed in the amount of $500 or less -- or reduces its Claim,
   when voting on the Plan, to $500 -- will receive a Cash
   distribution in the amount of its Allowed Claim rather than
   participating in the distributions for Class 9.  The Debtors
   estimate that there are Allowed Claims aggregating
   approximately $800,000 that are $500 or below and that up to
   an additional 600 holders of Allowed Claims between $500 and
   $1,000 may reduce their Claims to $500 -- representing
   additional payments of $300,000 on account of Allowed Claims
   of approximately $400,000, in each case which will fall within
   Class 10.  As a result of the fact that a substantial portion
   of the Convenience Claims relate to unclaimed property, the
   Debtors believe that a large portion of the Cash payments to
   be made to Class 10 will revest in the Debtors;

H. Securities Litigation Claims or Class 15 Claims have been
   deleted from the Plan; and

I. Based on (i) an assumed trading price equal to the assumed
   midpoint Equity Value of $241,000,000, (ii) a distribution of
   approximately 10,000,000 shares of New Common Stock, and (iii)
   an estimated trading volatility of between 40% and 60% --
   based on observed historical trading volatilities of publicly
   traded companies that are comparable to the Debtors, Gleacher
   computed the theoretical value of a New Warrant using a
   variant of a standard computation methodology for the
   valuation of warrants of $7.96.  The value of a New Warrant is
   estimated to be in a range from, $5.46 to $10.46 per New
   Warrant.  The aggregate value of the New Warrants is estimated
   to be in a range from $1,400,000 to $2,600,000, with a
   midpoint of $2,000,000.

The Voting Deadline and the Subscription Expiration Date will be
on September 30, 2003.

A full-text copy of Magellan's 3rd Amended Plan is available for
free at:

          http://bankrupt.com/misc/3rdAmendedPlan.pdf

A full-text copy of Magellan's 3rd Amended Disclosure Statement
is available for free at:

   http://bankrupt.com/misc/3rdAmendedDisclosureStatement.pdf   
(Magellan Bankruptcy News, Issue No. 12: Bankruptcy Creditors'
Service, Inc., 609/392-0900)  


MARINER HEALTH: Inks Definitive Pact to Sell Florida Facilities
---------------------------------------------------------------
Mariner Health Care, Inc. (OTC Bulletin Board: MHCA) has entered
into a definitive agreement, with an affiliate of Formation
Capital, LLC and Longwing Real Estate Ventures, LLC, to divest 20
of its Florida skilled nursing facilities.  

Under the agreement, the Purchaser will acquire the real estate
and certain personal property-related to the 20 SNFs.  Mariner
will receive approximately $92 million as consideration for the 20
facilities.

The purchase price is comprised of approximately $78 million in
gross cash proceeds and a $14 million, five-year subordinated
promissory note.  Mariner expects the net cash proceeds, after
transaction costs and retirement of certain mortgage debt, to
approximate $65 million, which will be used to reduce its
outstanding senior term loan balance.  The current outstanding
balance under the Mariner senior debt is approximately $209
million.

The Purchaser will lease the 20 Florida SNFs to an affiliate of
Sovereign Healthcare Holdings LLC, which will operate the SNFs.  
Sovereign is a recently formed entity involving Mr. William
Krystopowicz, President of the newly formed operating entity, Mr.
Darrel Hager, who currently serves as President of Mariner's
Florida subsidiary, and Mr. John Notermann, Executive Vice
President and Chief Financial Officer of Sovereign.  The 20 SNFs
have 2,502 licensed beds.

Mariner's Chief Executive Officer, Chris Winkle, commented, "This
transaction affords us the opportunity to substantially reduce our
exposure to liability insurance costs and litigation risks in the
state of Florida and at the same time de-leverage the company."

The consummation of the proposed transaction is expected to occur
on or about September 30, 2003, subject to satisfaction of
customary closing conditions, including but not limited to,
regulatory, governmental and bank approvals.

Mariner is headquartered in Atlanta, Georgia, and operates over
290 skilled nursing and assisted living facilities as well as 12
long-term acute care hospitals representing approximately 38,000
beds across the country.

Formation Capital, LLC, is an Atlanta, Georgia-based investor and
owner of senior housing properties.  Longwing Real Estate
Ventures, LLC, is a New York private investment company.


MASSEY ENERGY: Promotes Baxter Phillips to Chief Fin'l Officer
--------------------------------------------------------------
Massey Energy Company's (NYSE: MEE) Board of Directors has elected
Baxter F. Phillips, Jr. to the position of Senior Vice President
and Chief Financial Officer, effective September 1, 2003.  Mr.
Phillips, 57, will fill the position previously held by Kenneth J.
Stockel, who has resigned due to family considerations to return
to his home city of Houston, Texas.

Mr. Phillips will report to Don L. Blankenship, Massey Energy
Chairman and CEO.  "Baxter is a strong and well-respected member
of our management team and a natural fit for this position,"
stated Blankenship.  "He has been with Massey for many years and
has a wealth of knowledge and experience."

Reporting to Mr. Phillips will be the financial accounting,
regulatory compliance, audit, tax, treasury and investor relations
functions.

Mr. Phillips has twenty-two years of service with the Company and
has served as Vice President and Treasurer of Massey Energy
Company since it went public in November 2000.  He joined A.T.
Massey Coal Company, Inc. in 1981 and served in a variety of
functions since that time, including export sales, treasury, cash
management, human resources and benefits. Immediately prior to
becoming Treasurer, he served as Vice President of Purchasing and
Administration for A.T. Massey.

Mr. Phillips, a Virginia native, is a graduate of Virginia
Commonwealth University and received his Masters of Business
Administration from that institution in 1976.  Prior to joining
Massey, he pursued a career in banking and investment management
in Richmond, Virginia and Washington D.C.  He and his wife,
Sharon, have resided in Richmond for 34 years.

Mr. Phillips will be succeeded as Treasurer by Philip W. Nichols,
56, who joined Massey in November 2000 as Assistant Treasurer.  
Mr. Nichols was instrumental in establishing the Treasury function
for Massey Energy and putting in place its most recent financing.  
Prior to joining Massey Energy, he served in various treasury
management capacities with Dominion Resources and Dominion
Virginia Power.

Massey Energy Company, headquartered in Richmond, Virginia, is the
fourth largest coal company in the United States based on produced
coal revenue.

As reported in Troubled Company Reporter's July 15, 2003 edition,
Standard & Poor's Ratings Services revised its outlook on Massey
Energy Company to stable from negative. At the same time, Standard
& Poor's assigned its BB+ rating to Massey's $355 million secured
credit facility. In addition, Standard & Poor's affirmed its
existing ratings on the company.

The new $355 million bank credit facility was rated 'BB+', one
notch above the corporate credit rating. The new facility consists
of a $250 million term loan due 2008 and a $105 million revolver
due 2007 and is secured by various assets including certain
account receivables, inventory, and certain property, plant &
equipment. The term loan has a manageable amortization schedule of
$0.6 million per quarter until maturity, and an early maturity
trigger based on whether Massey's existing 6.95% senior notes are
refinanced before January 1, 2007.


MEDICALCV INC: Elects Larry Horsch as Chairman of the Board
-----------------------------------------------------------
MedicalCV, Inc. (OTCBB:MDCVU), a Minnesota-based cardiothoracic
surgery device manufacturer, announced that Larry Horsch has
joined its board of directors as an independent director,
effective immediately, and assumed the position of chairman of the
board.

Horsch was one of the founding directors of SciMed Life Systems,
Inc., and served as its chairman from 1977 to 1994. Following
SciMed's merger into Boston Scientific Corporation (NYSE:BSX) in
1995, Horsch served on Boston Scientific's board of directors
until May 2003.

"Our management is extremely pleased to add this caliber of talent
to our board of directors," said Blair P. Mowery, MedicalCV's
president and chief executive officer. "Larry and I have talked
extensively over the last year about MedicalCV's vision, existing
technology and ongoing projects. He strongly shares our vision and
corporate direction. In addition, Larry also agreed to play an
active role in managing our technology acquisitions. New
technology is a significant component of our long-term growth
strategy."

Horsch has extensive experience with medical companies. "I am very
impressed with the technology at MedicalCV and its accomplishments
over the last few years," said Horsch. "It is obvious that the
company will have a major strategic advantage in heart valve
production when MedicalCV's carbon manufacturing process is
approved for the U.S. market. In addition, several programs
approaching market introduction will have a significant impact on
future growth. I'm looking forward to assisting the management in
executing their long-range vision."

Our company is a Minnesota-based cardiothoracic surgery device
manufacturer that launched its Omnicarbon(R) heart valve in the
United States in early 2002. Led by a new management team, we are
focused on building a worldwide market in mechanical heart valves
and other innovative products for the cardiothoracic surgical
suite. Our Omnicarbon heart valve has an established market
position in a number of key regions of Europe, South Asia, the
Middle East, and the Far East. Although international markets will
continue to play an important role in our results, the U.S. market
offers tremendous growth potential for the Omnicarbon valve. In
fiscal year 2003, we added the IMA Access(TM) Retractor to our
line, which is a device for exposing the internal mammary artery
during cardiopulmonary bypass procedures. In addition, we entered
into an agreement with Segmed, Inc., to commercialize an
annuloplasty product known as the Northrup Universal Heart Valve
Repair System(TM). We have a fully integrated manufacturing
facility, where we design, test and manufacture our products. Our
securities are traded on the OTC Bulletin Board under the symbol
"MDCVU."

MedicalCV Inc.'s April 30, 2003 balance sheet shows a total
shareholders' equity deficit of about $390,000.


MERRILL LYNCH: Fitch Affirms B- Rating on $11.7MM Class F Notes
---------------------------------------------------------------
Fitch Ratings upgrades the following classes of Merrill Lynch
Mortgage Investors, Inc.'s commercial pass-through certificates,
series 1995-C2.

     -- $12.2 million class B to 'AAA' from 'AA+';

     -- $14.6 million class C to 'AAA' from 'A+';

     -- $14.6 million class D to 'AA' from 'BBB';

     -- $11.6 million class E to 'BBB-' from 'BB';

Fitch also affirms the following classes:

     -- $44.6 million class A-1 'AAA';

     -- $12.1 million class A-2 'AAA';

     -- Interest only class IO 'AAA';

     -- $11.7 million class F 'B-';

Fitch does not rate the $19 million class G certificates. The
upgrades follow Fitch's annual review of the transaction which
closed in October 1995.

The rating upgrades are a result of continued overall pool
performance and additional credit enhancement provided by loan
payoff and amortization. According to the July 2003 remittance
report, the pool balance has paid down 85% to $140.3 million from
$962.4 million at issuance. GMAC Commercial Mortgage Corp., the
master servicer, collected year-end 2002 financials for 74% of the
pool. The weighted average debt service coverage ratio for
comparable loans was 1.47 times for YE 2002, compared to 1.39x at
issuance.

Fitch also recognized that after expected losses, the transaction
may not be able to support the 'target credit enhancement levels'
described in the deal documents for classes E and F. Those classes
will then only receive interest, not principle until the required
subordination levels are once again met.

Perimeter Square Shopping Center, the largest loan in the pool
(12.3%) is real estate owned. The loan transferred to special
servicing when 2 tenants accounting for 52% of the gross leasable
area vacated. There are two other REO loans in the pool (5.1%),
securitized by a hotel and a retail property. Fitch expects losses
on each of these loans.

Hypothetical stress scenarios were applied to the trust, where the
above loans and other loans that concerned Fitch as having the
potential to become problematic were assumed to default. Even
under these stress scenarios, the resulting subordination levels
remain sufficient for the upgrades. Fitch will continue to monitor
this transaction, as surveillance is ongoing.


METALLURG: Ratings Cut as Tight Liquidity Pressures Covenants
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
ratings on metal alloy producer Metallurg Inc. and its holding
company parent, Metallurg Holdings Inc., to 'CCC+' from 'B-' based
on continued weak financial performance and liquidity concerns.
The current outlook is negative.
     
"It is doubtful that Metallurg will be in compliance with a $10
million minimum liquidity covenant under its revolving credit
facility indenture, which if enforced, will keep it from making
its Dec. 1, 2003, $5.5 million interest payment on its senior
notes," said Standard & Poor's credit analyst Dominick D'Ascoli.
"These factors could also restrict the upstream of funds to
Metallurg Holdings in order to service the Jan. 15, 2004, $7.7
million interest payment on its $121 million outstanding senior
discount notes".
     
The ratings reflect Metallurg Inc.'s below-average business
position as a global producer and marketer of metal alloys used by
manufacturers of steel, aluminum, and superalloys; its aggressive
financial policy; poor financial performance; and declining
liquidity. The ratings also reflect concerns about the ability of
Metallurg to service its interest payments and the interest
payments at its parent.


MICHAELS STORES: Ratings Raised on Better Operating Performance
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit,
senior unsecured debt, and bank loan ratings on specialty craft
retailer Michaels Stores Inc. to 'BB+' from 'BB'. The outlook is
stable.
     
"The upgrade is based on the company's improved operating
performance and cash flow protection measures, which have
benefited from better inventory management and a trend toward
home-based activities," said credit analyst Robert Lichtenstein.
EBITDA rose more than 25% to $354 million for the 12 months ended
May 3, 2003. Moreover, Michaels has been able to improve its cash
flow protection measures while expanding its store base and
significantly upgrading its infrastructure and inventory systems.
     
The ratings reflect the company's position as the only retailer in
the arts and crafts industry with national scope, improving
financial performance and credit protection measures, and adequate
liquidity. These strengths are partially offset by the company's
participation in the competitive and fragmented crafts industry,
and the challenges of improving inventory management and managing
new store growth.
     
Liquidity is adequate, with $211 million in cash and a $200
million revolving credit facility, of which $174 million was
available as of May 3, 2003. The credit facility matures in 2005,
while the company's senior unsecured notes mature in 2009.
Borrowings under the credit facility are significantly higher
during the third quarter to meet working capital needs for the
holiday season.
     
Capital expenditures are expected to increase to $161 million in
2003, from $109 million in 2002, to support new store growth and
infrastructure improvements. Standard & Poor's expects that cash
balances and operating cash flow will be sufficient to service
debt and fund capital expenditures.


MILLENNIUM CHEMICALS: June Net Capital Deficit Narrows to $31MM
---------------------------------------------------------------
Millennium Chemicals (NYSE:MCH) filed its second quarter 2003 Form
10-Q yesterday, which reflects all accounting corrections for the
restatement items discussed below. Millennium reported a second
quarter 2003 basic and diluted EPS loss of $0.14 compared to basic
and diluted EPS of $0.02 per share in the second quarter of 2002.
Excluding unusual items, the second quarter 2003 EPS loss was
$0.06 compared to an EPS loss of $0.02 in the second quarter of
2002.

Robert E. Lee, President and CEO said, "While Millennium's recent
results have been disappointing, we are confident that the steps
we are taking to improve our cost structure and operations will
benefit our company."

In the second quarter of 2003, Millennium reported a net loss of
$9 million compared to net income of $2 million in the second
quarter last year. Included in the second quarter 2003 results are
after tax costs of $4 million, or $0.06 per share, associated with
Equistar's early payment of debt using proceeds from its private
placement of senior notes completed in April 2003. An after-tax
profit of $3 million, or $0.04 per share, related to the
resolution of certain legacy claims was recorded in the second
quarter of 2002.

Operating income from majority-owned businesses was $24 million in
the second quarter of 2003, an improvement of $4 million from $20
million in the second quarter of 2002 and a decrease of $3 million
from $27 million in the first quarter of 2003. Second quarter 2003
sales from those businesses were $416 million compared to $405
million in the second quarter of 2002.

At June 30, 2003, the Company's balance sheet shows a total
shareholders' equity deficit of about $31 million.

               Restatement of Financial Statements

As a result of errors discovered in the third quarter of 2003, the
Company is restating its financial statements for the years 1998
through 2002 and for the first quarter of 2003, to correct its
accounting for deferred taxes relating to its Equistar investment
and French subsidiaries, the calculation of its pension benefit
obligations and its accounting for a multi-year precious metals
transaction. The Company's independent auditors,
PricewaterhouseCoopers LLP, concur with the Company's decision to
restate its financial statements.

For a description of these restatements and a reclassification of
selling, development and administrative costs previously allocated
to the Company's investment in Equistar, please see the Company's
Quarterly Report on Form 10-Q for the period ended June 30, 2003,
filed on August 19, 2003 and, in particular, "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Restatement of Financial Statements," located
therein. The information in the attached Tables I through V has
been adjusted to reflect these restatements and such
reclassification. The Company intends to file an amendment to its
Annual Report on Form 10-K for the year ended December 31, 2002
and an amendment to its Quarterly Report on Form 10-Q for the
quarter ended March 31, 2003 to reflect these restatements and
such reclassification.

                      Titanium Dioxide

The Titanium Dioxide (TiO2) segment reported second quarter
operating income of $23 million, compared to $15 million in the
second quarter of 2002 and $21 million in the first quarter of
2003.

In local currencies, average second quarter prices increased 7
percent from the second quarter of 2002 and were comparable to the
first quarter of 2003. In US dollar terms, the second quarter
worldwide average selling prices increased 15 percent from the
second quarter of 2002 and increased 2 percent from the first
quarter of 2003.

Second quarter 2003 TiO2 sales volume of 145,000 metric tons
represented a decrease of 15 percent from the second quarter of
2002 and was equal to the first quarter of 2003. Sales volume
trended down each month during the quarter and was lower than
expected due to the weak global economy and adverse weather,
primarily in North America.

The second quarter 2003 TiO2 operating rate was 96 percent of
annual nameplate capacity of 690,000 metric tons compared to 89
percent in the second quarter of 2002 and 88 percent in the first
quarter of 2003. The Company's TiO2 finished goods inventories
increased during the second quarter.

                            Outlook

Operating profit in the TiO2 business segment is expected to
decline in the third quarter of 2003 compared to the second
quarter of 2003 as production may slow to meet a softer demand
outlook due to continuing weakness resulting from uncertain
worldwide economic conditions and competitive pressures. Weakening
foreign currencies against the US dollar and competitive pricing
may result in downward pressure on average US dollar TiO2 selling
prices in the third quarter of 2003.

                              Acetyls

The Acetyls segment reported second quarter operating income of $5
million compared to $3 million in the second quarter of 2002 and
$7 million in the first quarter of 2003. The extended acetic acid
plant shutdown impacted profits by about $3 million in the second
quarter of 2003.

In the aggregate, the weighted-average US dollar price for VAM and
acetic acid in the second quarter of 2003 increased 42 percent
compared to the second quarter of 2002 and 8 percent from the
first quarter of 2003. Margins for the same periods have not
increased similarly due to rising natural gas feedstock prices.
Aggregate volume for VAM and acetic acid in the second quarter of
2003 decreased 13 percent from the second quarter of 2002 and
decreased 10 percent from the first quarter of 2003.

                              Outlook

Operating profit in the Acetyls business segment for the third
quarter of 2003 is expected to be similar to the second quarter of
2003 reflecting stable market conditions in Europe and the
Americas. Higher natural gas costs in the second quarter of 2003,
which flow through cost of goods sold in the third quarter of
2003, offset the benefit from the absence of the plant shutdown
which occurred in the second quarter.

                      Specialty Chemicals

The Specialty Chemicals segment reported second quarter of 2003
operating income of $2 million, equal to both the second quarter
of 2002 and the first quarter of 2003. Sales volume increased 34
percent from the second quarter of 2002 and 8 percent from the
first quarter of 2003. Average selling prices decreased 21 percent
compared to the second quarter of 2002 and 11 percent from the
first quarter of 2003. The price of crude sulfate turpentine, the
key raw material, increased 30 percent from last year's second
quarter and the first quarter of 2003.

                            Outlook

Operating profit for the Specialty Chemicals business segment in
the third quarter of 2003 is expected to be similar to the second
quarter of 2003. Fragrance chemicals markets remain competitive,
but new flavor products are contributing to results. CST is
expected to be in short supply, and costs are expected to be
higher, requiring the use of a higher-cost alternative to CST.

                            Equistar

Millennium's 29.5 percent stake in Equistar generated a post-
interest loss on investment of $14 million in the second quarter
of 2003 compared to a loss of $8 million in the second quarter of
2002 and a $43 loss in the first quarter of 2003. Equistar's Gulf
Coast olefin plants that can consume liquid raw materials
demonstrated their differential cost advantage despite crude oil
prices remaining high, averaging close to $30 per barrel for the
second quarter. This advantage was partially offset by depressed
volumes for Equistar and for the chemical industry, caused by
post-Iraq war inventory reductions, the impact of SARS, and
generally poor economic conditions.

Compared to the first quarter of 2003, Equistar's performance
improvement was primarily a function of the lower cost of ethylene
production at its Gulf Coast liquid-based olefin plants. This raw
material advantage was largely responsible for an improvement of
approximately $100 million in Equistar's net income. CMAI, an
independent chemical industry consultant, estimates that the
average cost of producing ethylene across the industry decreased
by approximately 5 cents per pound compared to the first quarter
of 2003. However, as a result of Equistar's flexibility to process
liquid raw materials, its equivalent costs decreased by nearly 8
cents per pound. Complementing this improvement, CMAI estimates
that polymer pricing averaged 3 cents per pound higher than the
first quarter average price. The positive impacts of the lower
ethylene production costs and higher polymer prices were partially
offset by significant volume reductions in ethylene and
derivatives. As a group, Equistar's ethylene and derivative
products sales volume were about 13 percent below first quarter
2003 sales levels. Equistar's polymers sales volume was impacted
by the first quarter 2003 sale of the Bayport polypropylene.

Millennium's share of Equistar's underlying second quarter sales
was $471 million and operating income was $8 million. Equistar did
not distribute any cash to Millennium in the second quarter of
2003.

                          Outlook

During the second quarter of 2003, Equistar's sales volume
generally demonstrated a slow but steady improvement and this
trend has continued into the third quarter of 2003. Equistar
expects to continue to benefit from its liquid raw material
advantage, although this advantage may not be as strong as the
second quarter of 2003. The potential for continued raw material
cost volatility represents an uncertainty, but Equistar believes
that market fundaments will continue to favor its liquid-based
olefins position. Performance in the third quarter of 2003 will be
largely dependent upon the pace of global economic recovery.
Assuming moderate economic recovery and improved global stability,
Equistar would expect to benefit from strengthening sales volume
and moderating raw material prices. However, given current
depressed industry operating rates, it will be difficult to
achieve and sustain product margin improvements in the near term.

                    Debt and Capital Spending

Net debt (total debt less cash) at June 30, 2003 and July 31,
2003, totaled $1.196 billion compared to $1.145 billion at
March 31, 2003.

Year-to-date capital spending was $19 million compared to $25
million during the first six months of 2002. Depreciation and
amortization was $55 million for Millennium's majority-owned
businesses in the first six months of 2003. Full year capital
spending is expected to be approximately $50 million in 2003,
while depreciation and amortization should total about $110
million.

For a further description of the Company's indebtedness and
capital spending and its liquidity and capital resources, please
see the Company's Quarterly Report on Form 10-Q for the period
ended June 30, 2003 filed on August 19, 2003 and, in particular,
"Management's Discussion and Analysis of Financial Condition and
Results of Operation -- Liquidity and Capital Resources," located
therein.

                    Cost Reduction Program

On July 21, 2003, the Company announced that it would implement a
program to reduce costs. This program will result in the departure
of approximately 175 employees worldwide. The Company also
announced that its offices in Red Bank, New Jersey would close
effective September 1, 2003 as part of this program, and that its
executive headquarters would be relocated to Hunt Valley,
Maryland, where the Company has existing administrative offices.
Given the volatile industry in which it operates, the Company
stated that it was implementing the program to reduce expenses and
strengthen its balance sheet.

The Company expects to realize approximately $20 million of annual
operating expense savings from the cost-reduction program
announced on July 21, 2003. The majority of the cost-reduction
program is expected to be completed by the fourth quarter of 2003.
The Company expects to record charges totaling approximately $20
million to $25 million associated with this program. The Company
has recorded charges of $1 million in the second quarter of 2003
for severance-related costs for departing Red Bank, New Jersey
employees. Most of the remaining estimated charges for this
program not included in the second quarter 2003 results, including
contractual commitments for ongoing lease costs for the remaining
term of the lease agreement for the Red Bank office, are expected
to be included in the third quarter 2003 results. Smaller charges
are expected to be recorded for several quarters subsequent to the
third quarter of 2003. Cash payments, estimated at approximately
$15 million, for implementation of this program are expected to be
made in the third quarter of 2003. The remainder of the cash
payments relating to the reorganization, which are estimated to be
$5 million to $10 million, will be disbursed in subsequent
quarters.

                CORPORATE OFFICE ADDRESS CHANGE

Effective September 1, 2003, Millennium's corporate headquarters
office address is:

                      Millennium Chemicals
                        20 Wight Avenue
                           Suite 100
                  Hunt Valley, Maryland  21030
                  Telephone number: 410-229-4400

Millennium Chemicals -- http://www.millenniumchem.com-- is a  
major international chemicals company, with leading market
positions in a broad range of commodity, industrial, performance
and specialty chemicals.

Millennium Chemicals is:

-- The second-largest producer of TiO2 in the world, the largest
    merchant seller of titanium tetrachloride and a major producer
    of zirconia, silica gel and cadmium/based pigments;

-- The second-largest producer of acetic acid and vinyl acetate
    monomer in North America;

-- A leading producer of terpene-based fragrance and flavor
    chemicals; and,

-- Through its 29.5% interest in Equistar Chemicals, LP, a
    partner in the second-largest producer of ethylene and third-
    largest producer of polyethylene in North America, and a
    leading producer of performance polymers, oxygenated
    chemicals, aromatics and specialty petrochemicals.


MILLER INDUSTRIES: Seeks Default Waiver Under Credit Agreement
--------------------------------------------------------------
Miller Industries, Inc. (NYSE: MLR) announced financial results
for the second quarter of 2003, which ended June 30, 2003.

For the second quarter of 2003, net sales from continuing
operations were $58.0 million, compared with $61.2 million in the
second quarter of 2002. Second quarter 2003 income from continuing
operations was $1.6 million, or $0.18 per diluted share, compared
with income from continuing operations of $1.5 million, or $0.16
per diluted share, in the second quarter of 2002.

During the quarter ended December 31, 2002, the Company's
management and its board of directors made the decision to divest
of its remaining towing services segment, as well as the
operations of the distribution group of the towing and recovery
equipment segment. As a result, in accordance with generally
accepted accounting principles, the assets for the towing services
segment and the distribution group are considered a "disposal
group" and the assets are no longer being depreciated. All assets
and liabilities and results of operations associated with these
assets have been separately presented in the accompanying
financial statements. The statements of operations and related
financial statement disclosures for all prior years have been
restated to present the towing services segment and the
distribution group as discontinued operations separate from
continuing operations. The discussions and analyses that follow
are of continuing operations, as restated, unless otherwise noted.

The results of operations and loss on disposal associated with
certain towing services markets, which were sold in June 2003 have
been reclassified from discontinued operations to continuing
operations given the Company's significant continuing involvement
in the operations of the disposal components via a consulting
agreement, and the Company's ongoing interest in the cash flows of
the operations of the disposal components via a long-term license
agreement.

Including a loss of $2.1 million, or $0.23 per diluted share,
after-tax, from these discontinued operations, Miller Industries
reported a net loss for the 2003 second quarter of $493,000 or
$0.05 per diluted share, compared to a net loss for the 2002
second quarter of $342,000, or $0.04 per diluted share. The net
loss for the second quarter of 2002 includes a loss from
discontinued operations of $1.8 million, or $0.20 per diluted
share.

Cost of operations in the second quarter of 2003 were $49.4
million, compared to $52.1 million in the year-ago period. For the
2003 second quarter, selling, general and administrative expenses
were $4.6 million, versus $5.5 million in the prior year period,
reflecting the Company's ongoing focus on operating cost control.
Interest expense in the second quarter of 2003 was $685,000,
compared to $1.2 million in the year-ago second quarter. The
significant reduction in interest expense reflects the current
interest rate environment and the Company's ongoing efforts to
reduce debt levels.

For the six-month period ended June 30, 2003, net sales from
continuing operations were $105.9 million versus $116.6 million
during the prior-year period. During the first half of 2003 the
Company reported income from continuing operations of $3.4
million, or $0.36 per diluted share, compared to income from
continuing operations of $3.7 million, or $0.39 per diluted share
a year ago. Including a loss from discontinued operations of $4.4
million, or $0.47 per diluted share, the Company reported a net
loss for the first half of 2003 of $1.1 million, or $0.11 per
diluted share. Including a loss from discontinued operations of
$4.2 million, or $0.45 per diluted share, and a goodwill
impairment charge related to the Company's adoption of FAS 142,
"Accounting for Goodwill and Other Intangible Assets" of $21.8
million, or $2.34 per diluted share, as previously announced, the
Company reported a net loss for the 2002 six-month period of $22.4
million, or $2.40 per diluted share.

Jeffrey I. Badgley, President and CEO of Miller Industries,
commented, "The trends that have affected our markets since early
last year continued into the second quarter of 2003, including
delays in purchasing decisions by our customers, as well as an
increasingly competitive selling environment. As economic
conditions remained weak during the quarter, we stayed the course
of effectively managing our operating costs and other expenses and
reducing debt levels, which resulted in improved income from
continuing operations versus a year ago."

Mr. Badgley concluded, "While we don't foresee an immediate
turnaround in our markets, we have seen some improvement since the
end of the first quarter. Going into the second half of 2003,
Miller Industries' focus will remain the same, to concentrate on
our core manufacturing operations as we fully exit the remaining
RoadOne markets, and manage costs and efficiencies to position the
Company for an upturn in our business."

The Junior Credit Facility matured and was due and payable on
July 23, 2003, under which $13.8 million was outstanding June 30,
2003. The Company has not yet repaid or refinanced the outstanding
principal and interest under the Junior Credit Facility. The
Company's failure to repay all outstanding principal, interest and
any other amounts due and owing under the Junior Credit Facility
on the maturity date constituted an event of default under the
Junior Credit Facility and also triggered an event of default
under the Senior Credit Facility cross-default provisions.
Pursuant to the terms of the Intercreditor Agreement, the junior
lender agent and the junior lenders are prevented from taking any
enforcement action or exercising any remedies against the Company,
its subsidiaries or their respective assets in respect of such
event of default during a standstill period which will expire on
the earlier of: (i) November 26, 2003 (the date which is 120 days
after the date that written notice was given by the junior lender
agent to the senior lender agent of its intent to commence an
enforcement action as a result of the occurrence of the Junior
Credit Facility defaults), subject to extension by notice from
senior lender agent to junior lender agent to April 24, 2004 (the
date which is 270 days after the date of the Junior Notice); (ii)
the acceleration of the maturity of the obligations of the Company
under the Senior Credit Facility by the senior lender agent, and
(iii) the commencement of any bankruptcy, insolvency or similar
proceeding against the Company or certain of its subsidiaries.

On August 5, 2003, the senior agent gave a payment blockage notice
to the junior agent, thereby preventing the junior agent and
junior lenders from receiving any payments from the Company in
respect of the Junior Credit Facility while such blockage notice
remains in effect. This payment blockage will expire on the
earlier of (i) February 1, 2004 (subject to an extension to May 1,
2004) if the Standstill Period is extended from November 26, 2003
to April 24, 2004 at the election of the senior lender agent by
notice to the junior lender agent as described above, or (ii) the
date that the Senior Credit Facility defaults giving rise to the
payment blockage notice have been cured or waived. An event of
default has also occurred under the Junior Credit Facility and the
Senior Credit Facility as a result of the auditor's report for the
Company's December 31, 2002 financial statements including an
explanatory paragraph that referred to uncertainty about the
Company's ability to continue as a going concern for a reasonable
period of time. These existing events of default under the Senior
Credit Facility could result in the acceleration of the amounts
due under the Senior Credit Facility as well as other remedies if
not waived by the senior lenders. There is no assurance that the
Company will be able to obtain such a waiver from the senior
lenders or a waiver from the junior lenders of any events of
default that have occurred.

The Company is currently in discussions with the lenders under the
Junior Credit Facility to extend the maturity date of the Junior
Credit Facility and/or to refinance the Junior Credit Facility.
The Company has also entered into discussions with the lenders
under the Senior Credit Facility to refinance the Senior Credit
Facility. There can be no assurance that the Company will be able
to extend the maturity date of the Junior Credit Facility or
refinance either or both Credit Facilities.

Finally, the Company recently submitted a plan to the New York
Stock Exchange for regaining compliance with the NYSE's continued
listing standards. The plan is centered on focusing all the
Company's resources, manpower as well as financial, on returning
the manufacturing operations to their historically profitable
levels. The NYSE may take up to 45 days to review and evaluate the
plan.

Miller Industries is the world's largest manufacturer of towing
and recovery equipment. The Company markets its towing and
recovery equipment under a number of well-recognized brands,
including Century, Vulcan, Chevron, Holmes, Challenger, Champion
and Eagle.


MIRANT CORP: Court Moves General Claims Bar Date to December 16
---------------------------------------------------------------
The U.S. Bankruptcy Court amends the Bar Date for all creditors,
except government units, to file their Proofs of Claim against any
of the Mirant Debtors to December 16, 2003.

Claim forms should be mailed to:

                 Bankruptcy Clerk's Office
                 501 W. Tenth Street
                 Forth Worth, Texas 76102
                 Telephone No. 817-333-6000

Governmental units have until January 10, 2004 to file their
claim, pursuant to Rule 3002(c) of the Federal Rules of
Bankruptcy Procedure. (Mirant Bankruptcy News, Issue No. 4;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


MIRANT CORP: EcoElectrica Investments' Chapter 11 Case Summary
--------------------------------------------------------------
Debtors: Mirant EcoElectrica Investments I, Ltd.  
         Puerto Rico Power Investments, Ltd.  
         1155 Perimeter Center West  
         Atlanta, GA 30338-5416  

Bankruptcy Case Nos.: 03-47927-dml11 and 03-47929-dml11

Type of Business: The Debtors are affiliates of Mirant
                  Corporation.

Chapter 11 Petition Date: August 18, 2003

Court: Northern District of Texas (Ft. Worth)

Judge: D. Michael Lynn

Debtors' Counsel: Judith Elkin, Esq.  
                  Haynes and Boone  
                  901 Main St., Suite 3100  
                  Dallas, TX 75202-3789  
                  214-651-5000  
                  Email: elkinj@haynesboone.com

                  Thomas E. Lauria, Esq.
                  White & Case LLP
                  200 S. Biscayne Blvd., Suite 4900
                  Miami, Florida 33131
                  Phone: 305-371-2700
                  Fax: 305-358-5744

Estimated Assets: More than $100 Million

Estimated Debts: More than $100 Million


MORGAN STANLEY: S&P Ups Ratings on Four Classes of 1996-C1
----------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on four
classes of Morgan Stanley Capital I Inc.'s commercial mortgage
pass-through certificates series 1996-C1. At the same time,
ratings are affirmed on three classes from the same series.

The rating actions reflect increased credit support levels
resulting from a 49.6% paydown, coupled with improved financial
performance of the remaining loan pool, with a reported year-end
2002 weighted average net cash flow debt service coverage ratio of
1.70x (98% of loans reporting), up from 1.53x at issuance. As of
July 2003, the loan pool balance was $171.69 million with 57
loans, down from $340.52 million with 99 loans at issuance. As of
July 2003, there was one 30-day delinquent loan (the eighth
largest loan, with a balance of $4.2 million, 2.5%), and 13 loans
on GMAC Commercial Mortgage Corp.'s (GMACCM, the master servicer)
watchlist. To date, realized losses from two loans total $3.5
million (2.0%). The delinquent loan was transferred to the special
servicer, Lennar Partners Inc., in May 2002 due to consistent late
payments. The collateral is a 383-pad mobile home park located in
Stillwater, N.Y. As of August 2003, the debt service is past due
for July 2003, and the tax and insurance escrow accounts remain
delinquent. The year-end 2002 DSCR declined to 1.13x with 74%
occupancy from a DSCR of 1.53x and 86.8% occupancy at issuance.
Lennar is continuing discussions with the borrower regarding
workout alternatives upon resolution of an outstanding water-
supply issue with the City of Stillwater.

GMACCM placed 13 loans on its watchlist ($41.39 million, 24.1%).
Three of the loans ($10.87 million, 6.3%) reported DSCRs below
1.10x (includes the fifth largest loan). The placement of the
other 10 loans ($30.52 million, 17.8%) on the watchlist reflect a
decline in occupancy at the properties.

Two of the top 10 loans on the watchlist are of concern to
Standard & Poor's:

     -- The fifth loan ($5.34 million, 3.1%) is secured by a 444-
        pad, mobile home park located in Orlando, Fla. The
        borrower reported that the decline in year-end 2002 DSCR
        of 1.09x from 1.44x at issuance was due to significant
        property repairs, which included remodeling the clubhouse
        and purchase of new equipment for the laundry room. As of
        March 2003, occupancy at the property increased to 98%
        from 90.7% at issuance.

     -- The ninth largest loan ($4.2 million, 2.5%) is secured by
        a 264-unit apartment complex also located in Orlando, Fla.
        The borrower reported that the property has suffered from
        increased neighborhood crime. Consequently, the property
        manager has hired a security company to monitor the
        property. The year-end 2002 DSCR declined to 1.22x with
        75% occupancy, from a DSCR of 1.53x with 91% occupancy at
        issuance.

Standard & Poor's stressed the delinquent loan and weaker
performing watchlist loans in its analysis, and determined that
the stressed credit enhancement levels adequately support the
raised and affirmed ratings.

The loan pool consists of multiple property types that include
retail (31%), multifamily (18%), self-storage (17%), and
manufacturing housing (14%). The pool is geographically diverse,
with properties located in 26 states; California and Maryland have
concentrations of 15.6% and 14.5%, respectively.
   
                        RATINGS RAISED
     
                  Morgan Stanley Capital I Inc.
       Commercial mortgage pass-thru certs series 1996-C1
   
                      Rating
          Class   To          From   Credit Support (%)
          C       AAA         AA                 34.90
          D-1     AA+         BBB+               24.98
          D-2     AA-         BBB                22.00
          E       BBB-        BB                 11.10
   
                        RATINGS AFFIRMED
   
                  Morgan Stanley Capital I Inc.
       Commercial mortgage pass-thru certs series 1996-C1
   
               Class   Rating   Credit Support (%)
               A       AAA                  57.70
               B       AAA                  45.80
               F       B                     3.16


NAT'L CENTURY: Pain Net Wants Rule 2004 Exam Order Reconsidered
---------------------------------------------------------------
The Pain Net Entities ask the Court to reconsider and vacate its
April 11, 2003 order authorizing the National Century Financial
Enterprises Debtors, and the NPF VI and NPF XII subcommittees to
conduct a Rule 2004 examination of Pain Net, Inc. and its
affiliated entities.  In the alternative, the Pain Net Entities
seek a protective order to quash the subpoena. The Pain Net
affiliates include:

   -- Pain Net, Inc.,
   -- Pain Net of California, Inc.,
   -- Pain Net of Texas, Inc.,
   -- Pain Net of Arizona, Inc.,
   -- Pain Net of Nevada, Inc.,
   -- Pain Net of Florida, Inc.,
   -- Pain Net of Hawaii, Inc.,
   -- Orthopedic Medical Group of the West, Inc.,
   -- ACCI/AllCare, Inc.,
   -- ACCI AllCare of Massachusetts, Inc.,
   -- ACCI/AllCare of Pennsylvania, Inc.,
   -- Allured Services, Inc.,
   -- Pain Net Northern California Management Corporation,
   -- Rivertown Surgery Center, LLC,
   -- Strongin Health Services Corporation, Texas NPI, Inc.,
   -- Pain Net of Washington, Inc.,
   -- Pain Net of Maryland, Inc.,
   -- ACCI/AllCare of Nevada, Inc.,
   -- ACCI/AllCare of Arizona, Inc., and
   -- Chatsworth Canoga Medical Center, Inc.

Charles H. Cooper, Jr., Esq., at Cooper & Elliot, in Columbus,
Ohio, reports that the subpoena the Debtors issued to Pain Net:

   -- has not been properly served,

   -- improperly requires Pain Net, Inc. to submit to a 2004
      examination in Columbus, Ohio,

   -- does not provide sufficient response time,

   -- does not delineate from which entity or entities testimony
      is being sought, and

   -- is overbroad and harassing.

The Debtors and the Subcommittees have created the false
impression that there exists a single, united entity called "Pain
Net," and that this single entity owes $116,000,000 to the
Debtors.  Mr. Cooper explains that the companies the Debtors
listed as the Pain Net Entities have not guaranteed each others'
debts, and there are no cross-collateralization agreements among
these entities.  Therefore, it is improper for the Debtors and
the Subcommittees to treat the various entities as a single unit.  
Thus, the Debtors should be required to justify, on a
corporation-by-corporation basis, the need to conduct a Rule 2004
examination.

The Debtors have identified "Pain Net" entities as companies
that:

   -- do not exist,

   -- have not existed for several years, and

   -- never received funding from the Debtors.

For instance, the Debtors list Pain Net of Washington, Inc. as an
"ACCI/AllCare" entity.  Mr. Cooper attests that this entity does
not exist.  Similarly, the Debtors identify Pain Net of Nevada,
Inc. as a "Pain Net entity."  Pain Net of Nevada, Inc. ceased
operating in 1996 and its corporate charter ended in 1998.
The Debtors also wish to conduct Rule 2004 examinations of Pain
Net of Florida, Inc. and Pain Net of Hawaii, Inc.  Pain Net of
Florida, Inc. was incorporated in Florida on December 28, 2000,
and never conducted any business whatsoever prior to its
dissolution in September 2001.  Likewise, Pain Net of Hawaii,
Inc. existed for less than one year, and during its existence it
never entered into a Sales and Subservicing Agreement with any of
the Debtors.

Furthermore, Allmed Services, Inc. and Strongin Health Services
Corporation, identified as "ACCI/AllCare" entities, were induced
by the Debtors to enter into Sales and Servicing Agreements dated
October 22, 2002.  However, the Debtors never advanced any funds
to these entities.  Therefore, there is no legitimate reason why
these entities must submit to a 2004 examination.

Mr. Cooper relates that the primary purpose of a Rule 2004
examination is to permit a party-in-interest to quickly ascertain
the extent and location of the estate's assets.  Although the
scope of a Rule 2004 examination is broad, it is not limitless.  
The examination should not be so broad as to be more disruptive
and costly to the party sought to be examined than beneficial to
the party seeking discovery.  Moreover, an examination cannot be
used for purposes of abuse or harassment.  

Moreover, Mr. Cooper continues, courts have repeatedly held that
the use of Rule 2004 discovery is improper once an adversary
proceeding or contested matter has been commenced.  Discovery
into matters bearing on the adversary proceeding or contested
matter must be conducted through the Federal Rules or other rules
applicable to the contested matter.  

The Debtors commenced adversary proceedings against many of the
so-called "Pain Net entities" and "ACCI/AllCare entities" on
November 18, 2002.  Accordingly, the use of Rule 2004
examinations is improper at this juncture.  Discovery must be
conducted in accordance with the protections afforded witnesses
under Rule 26 of the Federal Rules of Civil Procedures.

The Debtors have sought to compel attendance at the proposed 2004
exam through a subpoena.  The subpoena was sent, via facsimile,
on April 23, 2003 to the local counsel for certain of the Pain
Net Entities.  The subpoena seeks to compel the attendance of
"Pain Net, Inc," as labeled by the Debtors to refer to at least
seven separate entities.  Therefore, it is unclear which entity
the Debtors seek to examine.    

The subpoena seeks to compel the production of documents, and the
attendance of one or more witnesses, in Columbus.  The Debtors
must conduct any Rule 2004 examinations at the location of the
person or entity from whom information is sought.  

The subpoena also is defective inasmuch as neither a witness fee
nor a mileage fee was tendered with the subpoena.

Mr. Cooper also says that the Debtors' examination appears to be
designed to harass the Pain Net Entities.  This is evident from
the list of "documents requested".  It is virtually impossible to
respond to the request, because the request assumes that there is
a single, unified entity known as "Pain Net."  

It is beyond mere coincidence that the Debtors' request to
conduct a Rule 2004 examination was filed shortly after certain
of the entities listed in the subpoena rejected the Debtors'
effort to reach a global resolution of any outstanding
indebtedness.  The Debtors' effort to treat the various companies
as a single entity under the guise of a Rule 2004 examination is
designed to coerce the various entities to reach a resolution
with the Debtors in which they would collectively agree to pay
the total indebtedness. (National Century Bankruptcy News, Issue
No. 21; Bankruptcy Creditors' Service, Inc., 609/392-0900)


NATIONAL ENERGY: Annual Shareholders' Meeting Slated for Sept. 9
----------------------------------------------------------------
The annual meeting of shareholders of National Energy Group, Inc.,
a Delaware corporation, will be held at the University
Amphitheater, Holiday Inn Select-Dallas Central, 10650 North
Central Expressway, Dallas, Texas 75231 at 9:00 a.m., Central
Time, on September 9, 2003, to consider and vote on the following
matters:

         1. To elect five members of the Board of Directors of the
            Company to hold office until the next annual meeting
            of shareholders or until their successors have been
            duly elected and qualified;

         2. To consider and vote upon a proposal to amend the
            Company's Restated Certificate of Incorporation to
            enable the Company's Board of Directors to approve the
            transfer of equity interests which would otherwise be
            restricted by the Certificate of Incorporation prior
            to the adoption of the amendment. If such proposal is
            approved at the meeting, the Board of Directors of the
            Company has been asked to approve a request to
            transfer 49.9% of the outstanding common stock of the
            Company currently held by certain affiliates of Carl
            C. Icahn to American Real Estate Holdings L.P., which
            is controlled by Mr. Icahn. The Company has been
            informed that if such a transfer is approved by the
            Board of Directors, AREH intends to purchase
            additional shares of the Company's common stock so as
            to increase its ownership to be greater than 50% of
            the outstanding shares of common stock of the Company
            following such transfer;

         3. To consider and vote upon a proposal to ratify the
            selection of KPMG LLP as the Company's independent
            auditors for the current fiscal year ending
            December 31, 2003; and

         4. To transact such other business as may properly come
            before the meeting or any adjournments.

The Board of Directors has fixed the close of business on
August 12, 2003 as the record date for determination of those
shareholders entitled to vote, and only shareholders of record at
the close of business on that date will be entitled to notice of,
and to vote at, the meeting.  

At June 30, 2003, the Company's balance sheet shows a total
shareholders' equity deficit of about $68 million.

                   Oil and Gas Operations

NEG Holding LLC conducts its oil and gas operations through its
affiliate, NEG Operating LLC.  The Company manages all of these
oil and gas operations pursuant to a management agreement with NEG
Operating LLC.

National Energy Group, Inc. (OTC Bulletin Board: NEGI) is a
Dallas, Texas based company.


NORTHWESTERN CORP: Elects Gary G. Drook President and CEO
---------------------------------------------------------
The Board of Directors of NorthWestern Corporation (NYSE: NOR)
announced the election of Gary G. Drook as President and Chief
Executive Officer.  In addition, Michael J. Hanson was elected to
the position of Chief Operating Officer for the corporation.

Drook was elected interim Chief Executive Officer on Jan. 5, 2003,
and has been guiding the Company through its announced turnaround
efforts.

"On behalf of the board, we are pleased that Gary has agreed to
become NorthWestern's President and CEO and will continue to lead
the restructuring of the company," said Marilyn Seymann,
NorthWestern's Board Chair.  "In the past several months, Gary has
established a new leadership team, developed and is implementing
our restructuring strategy and has tackled a number of important
issues including improving the Company's internal controls."

Drook previously was president and chief executive officer of
AFFINA, Inc. a Peoria, Ill., provider of customer relationship
management programs.  Prior to joining AFFINA, Drook was president
of Network Services, Enhanced Business Services and Yellow Pages
for Ameritech Corporation.  He has served as a director of
NorthWestern since 1998.

Drook also announced that William M. Austin, who was appointed
Chief Restructuring Officer in April 2003, has taken on the
additional responsibility for cash management activities, while
executing the Company's plans to sell noncore assets and working
to reduce and restructure the Company's debt.  Austin is also
serving as lead executive of Expanets, NorthWestern's
communications services business, which includes providing day-
to-day operational oversight.

Drook said that Hanson will continue to lead the operations of
NorthWestern's core electric and natural gas utility operations
and will have responsibility for the strategic direction of the
utility business along with taking on the additional
responsibility for human resources management.

"Mike has continued to provide strong leadership for our core
utility operations while making sure we provide our customers with
award-winning reliable and cost-competitive energy services," said
Drook.  "NorthWestern's restructuring efforts are linked to our
regulated utility operations.  It is important that we have a top
utility veteran leading our operations, and Mike's experience and
demonstrated leadership makes him an important member of our
leadership team."

Hanson joined NorthWestern in 1998 as president and CEO of the
Company's South Dakota and Nebraska utility operations.  Following
the acquisition of the utility operations of the former Montana
Power Company in 2002, he took on the additional responsibility of
the integrated utility operations as president and CEO of
NorthWestern Energy.  Prior to joining NorthWestern, Hanson was
general manager and CEO of Northern States Power's South Dakota
and North Dakota operations.  He worked for NSP for nearly 20
years in various financial, legal and operating leadership
positions.  Hanson holds a Bachelor of Science degree from the
University of Wisconsin and a Juris Doctor degree from the William
Mitchell College of Law.

NorthWestern Corporation is one of the largest providers of
electricity and natural gas in the Upper Midwest and Northwest,
serving more than 598,000 customers in Montana, South Dakota and
Nebraska.  NorthWestern also has investments in Expanets, Inc., a
nationwide provider of networked communications and data services
to small and mid-sized businesses; and Blue Dot Services Inc., a
provider of heating, ventilation and air conditioning services to
residential and commercial customers.

Northwestern's June 30, 2003, balance sheet discloses a working
capital deficit of about $1.1 billion while net capital deficit
tops $504 million.


OM GROUP: Stephen D. Dunmead to Lead Company's Cobalt Business
--------------------------------------------------------------
OM Group, Inc. (NYSE: OMG) announced that, effective immediately,
Stephen D. Dunmead has been named vice president and general
manager, cobalt.

Dunmead, 40, had been the Company's vice president of technology
since 1998. He succeeds Todd W. Romance, who has left the Company.

"Steve Dunmead is a proven leader who understands both the nuances
of our cobalt business and the unique product needs of our
customers," said James P. Mooney, chairman and chief executive
officer. "By infusing our technology advancement efforts into our
cobalt operations, we will look to accelerate our new product and
new market development initiatives, as well as our strategic
priority of leveraging the profitability of our core business."

As OMG's vice president of technology, Dunmead had been
responsible for setting the Company's strategic direction for new
product development, applied technology, innovation and
intellectual property. Prior to joining OMG, he spent nine years
at The Dow Chemical Company in a variety of research and
management positions of increasing responsibility, focusing on new
products and processes for metal-based specialty products. He
graduated Summa Cum Laude with BS and MS degrees in ceramic
engineering from The Ohio State University. He earned his Ph.D. in
materials sciences and engineering, with minors in
thermodynamics/kinetics and applied statistics from the University
of California, Davis.

Mooney concluded, "[Wednes]day's action goes beyond our cost-
containment imperative and our ongoing efforts to right-size the
Company's management structure. While we have made great strides
on both counts, this is a critical step to continuing the
transformation of our cobalt business."

Headquartered in Cleveland, Ohio, OM Group operates manufacturing
facilities in the Americas, Europe, Asia, Africa and Australia.
For more information on OM Group, visit the Company's Web site at
www.omgi.com .

As reported in Troubled Company Reporter's July 24, 2003 edition,
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating on specialty chemical and refined metal products
producer OM Group Inc.

Standard & Poor's said that at the same time it has removed its
ratings on Cleveland, Ohio-based OM from CreditWatch where they
were placed Oct. 31, 2002. The current outlook is stable.


OSE USA: June 29 Net Capital Deficit Jumps-Up to $43 Million
------------------------------------------------------------
OSE USA, Inc. (OTC-BB: OSEE), reported its results for the second
quarter ended June 29, 2003.

On April 21, 2003, the Company announced management's decision to
discontinue the manufacturing segment. As of June 29, 2003, the
Company was in negotiation with a potential buyer to sell the
assets associated with the manufacturing segment. The Company
expects to finalize this transaction by the end of August 2003.

On June 25, 2003 The Company signed a letter of understanding with
a potential buyer to purchase the Company's manufacturing
operation (including related equipment, inventory, books, records,
and intellectual property) for a total of $1,000,000. The
$1,000,000 will include $500,000 in cash and a $500,000 secured
note with interest at the prime rate due in three years. There is
no relationship between the Company, or any of its affiliates, and
the Buyer. Pursuant to SFAS No.144, these former activities have
been accounted for as discontinued operations in the current
financial statements. The Company is left with the distribution
segment after eliminating its manufacturing operations. The
operating results shown on the Condensed Consolidated Statements
of Operations under continuing operations represents the three and
six months operating results from the distribution segment.

Revenues for the three and six month periods ended June 29, 2003
for the continuing operations were $782,000 and $1,552,000,
respectively, compared with revenues of $1,417,000 and $2,538,000
for the same periods one year ago. The Company reported a net loss
applicable to common stockholders of $3,903,000 or $0.07 per
diluted share, for the second quarter of 2003, compared with a net
loss applicable to common stockholders of $1,874,000 or $0.02 per
diluted share, for the second quarter of 2002. For the first six
months of 2003, the Company reported a net loss applicable to
common stockholders of $6,083,000 or $0.11 per diluted share,
compared with a net loss applicable to common stockholders of
$5,356,000 or $0.07 per diluted share, for the first six months of
2002. The operating results for the six months periods ended
June 30, 2002 included $1,400,000 cumulative effect of accounting
change as a result of goodwill impairment loss from implementing
SFAS 142. Excluding the effect of accounting change, net loss
applicable to common stockholders for the six months period ended
June 30, 2002 was $3,956,000 or $0.05 per diluted share.

At June 29, 2003, the Company's balance sheet shows a working
capital deficit of about $34 million, and a total shareholders'
equity deficit of about $43 million.

Founded in 1992 and formerly known as Integrated Packaging
Assembly Corporation, OSE USA, Inc. has been the nation's leading
onshore advanced technology IC packaging foundry. In May 1999
Orient Semiconductor Electronics Limited, one of Taiwan's top IC
assembly and packaging services companies, acquired controlling
interest in IPAC, boosting its U.S. expansion efforts. The Company
entered the distribution segment of the market in October 1999
with the acquisition of OSE, Inc.  In May 2001 IPAC changed its
name to OSE USA, Inc. to reflect the company's strategic
reorganization.

The company's close proximity to its customers allowed OSE USA to
provide dynamic, quick-response, application-specific packaging
solutions to customers worldwide. After the closure of its U.S.
manufacturing operations, the Company will focus on servicing its
customers through its offshore manufacturing affiliates. OSE USA's
customers include IC design houses, OEMs, and manufacturers. For
more information, visit OSE USA's Web site at
http://www.ose-usa.com  


OWENS CORNING: Committee Wants to Intervene in Avoidance Actions
----------------------------------------------------------------
The Official Committee of Unsecured Creditors of Owens Corning
Debtors asks the Court:

   -- for permission to intervene as a party plaintiff in certain
      Law Firm Avoidance Actions,

   -- to lift the stay applicable to those actions, and

   -- for authority to file a complaint and pursue additional
      avoidance actions on behalf of the Debtors' estates.

The Law Firm Avoidance Actions consist of lawsuits against these
law firms:

   1. Ness Motley Loadholt Richardson & Poole (Adv. Proc. No. A-
      02-5830);

   2. Peyton Parenti & Whitting (Adv. Proc. No. A-02-5831);

   3. The Estate of David T. Cobb (Adv. Proc. No. A-02-5832);

   4. Roxie Huffman Viator (Adv. Proc. No. A-02-5871);

   5. Terrence M. Johnson, Esquire (Adv. Proc. No. A-02-5872);

   6. Provost Umphrey Law Firm L.L.P. (Adv. Proc. No. A-02-5873);

   7. Reaud, Morgan & Quinn, Inc. (Adv. Proc. No. A-02-5874);

   8. Duke Law Firm, P.C. (Adv. Proc. No. A-02-5875);

   9. Lewis & Lewis, P.A. (Adv. Proc. No. A-02-5876);

  10. Vonachen, Lawless, Trager & Slevin (Adv. Proc. No. A-02-
      5878;

  11. Law Office of Peter T. Nicholl (Adv. Proc. No. A-02-5879).

To recall, on September 10, 2002, the Committee sought the
Court's consent to commence actions pursuant to Sections 544,
547, 548, and 550 of the Bankruptcy Code on behalf of the
Debtors' estates against certain law firms.  The Committee
pointed out that at a July 31, 2002 meeting, the Debtors refused
to pursue claims against the law firms -- an unsurprising
position, in the Committee's view, given management's alleged
intentional and complicit involvement in the transfers and
conveyances the Committee sought to avoid.  The Committee also
noted that the limitation period applicable to the claims against
the law firms, set forth in Section 546(a)(1) of the Bankruptcy
Code, was due to lapse on October 5, 2002.  

The Committee filed its request after the Debtors had refused to
pursue the claims and two weeks before the running of the
applicable statute of limitations.  The Committee believes that
the preferential complaints will bring millions of dollars back
into the estates.

However, the Committee's efforts to pursue the avoidance and
fraudulent conveyance actions against the law firms were stalled,
at least temporarily, by the Third Circuit's initial decision in
Official Comm. of Unsecured Creditors of Cybergenics Corp. v.
Chinery, 304 F.3d 316, 319 (3d Cir. 2002).  Before the Court had
an opportunity to rule on the Committee's request, the Third
Circuit held that only a trustee or debtor-in-possession has the
power to invoke Bankruptcy Code Section 544(b) to avoid
fraudulent transfers and that a court may not authorize a
creditor or creditors' committee to bring suit under Section
544(b) derivatively.

Christopher Winter, Esq., at Morris, Nichols, Arsht & Tunnell, in
Wilmington, Delaware, relates that the ruling seemed to foreclose
standing on the part of the Committee with respect to claims
predicated on similar provisions in Bankruptcy Code Sections 547
and 548.

At a hearing held on September 24, 2002, after the Cybergenics
decision was handed down, the Court directed the Debtors to
submit a written statement concerning the avoidance actions they
would and would not pursue accompanied by a brief explanation of
their reasons.  At the same hearing, the Court granted the
Debtors' request for an extension of the exclusivity period for
proposing a reorganization plan.  The Debtors affirmed their
intention to file a plan on October 31, 2002 -- and certainly no
later than November 26, 2002.

The Court's directive to the Debtors to explain the basis of
their intention to file or not file avoidance actions was
embodied in the September 25, 2002 Court Order.  Mr. Winter
maintains that the Debtors effectively failed to comply with the
Court's September 25, 2002 Order.  The Debtors submitted a letter
response on September 27, 2002 that was at best vague and, at
worst, evasive.

By order dated October 2, 2002, the Court, having found the
Debtors' explanations unclear and that the actions the
Committee requested permission to pursue presented colorable
claims, directed the Debtors to commence avoidance actions
against the over 100 law firms, or obtain valid and enforceable
tolling agreements from the law firms so that the actions against
them might be preserved.  Consequently, the Debtors secured
tolling agreements from all but 11 of the law firms.  However,
according to Mr. Winter, the Debtors grudgingly filed complaints
against the remaining law firms.  The complaints, with no
subtlety, betray the magnitude of the Debtors' reluctance to
pursue the avoidance claims in good faith and presaged the utter
lack of diligence with which the claims would later be
prosecuted.  The Debtors actually sought declarations that
various transfers and conveyances are not avoidable.  Only in the
alternative do the complaints state claims for recovery for the
estates.

Still off-put by their having to pursue any claims at all, the
Debtors, on October 16, 2002, just 12 days after filing the 11
complaints, asked the Court to stay those actions pending the
filing and confirmation of a plan.  The Committee vigorously
opposed this patent, self-serving attempt to bury the Law Firm
Avoidance Actions, and the facts that would be unearthed by
discovery, including testimony, to the detriment of the estates
and all creditors.  The Court, at a hearing on November 25, 2002,
deferred issuing a final ruling on the Debtors' request until at
least January.  The Court, nevertheless, stayed the Law Firm
Avoidance Actions during pendency of the request to give the
Debtors one final distraction-less opportunity to craft a
consensual plan.

On May 29, 2003, the Third Circuit, in an en banc decision,
reversed the September 20, 2002 Cybergenics ruling, holding that
"bankruptcy courts' equitable powers enable them to authorize as
a remedy in cases where a debtor-in-possession unreasonably
refuses to pursue an avoidance claim."

In the nine months that have elapsed since the Debtors were
directed to pursue or preserve avoidance actions against those
law firms, Mr. Winter tells Judge Fitzgerald that there has been
absolutely no development of the factual record underlying those
actions.  The Debtors have done everything in their power to put
off indefinitely inquiry into and development of the allegations
raised by the Committee.  Regrettably the Debtors' strategy may
be working.  Mr. Winter points out that witnesses have left and
may leave the Debtors.  Memories of persons who have not left may
have dimmed and files, through documents being lost or otherwise
fated, undoubtedly have thinned.  Indeed, the Debtors have said
that up to half of all their records no longer exist.  Only
through the operation of the discovery provisions of the Federal
Rules of Civil Procedure might the factual record that would
result in the return of tens and tens of millions of dollars to
the Debtors' estates be developed.

Mr. Winter explains that the targets of the complaints are
asbestos lawyers, including all on the Asbestos Committee, which
is a Plan Proponent, and Owens Corning's management, another Plan
Proponent.  All have personal interests in undermining, delaying,
and stopping the litigation.  

"These persons' self-interest in including in the plan they
propose -- that the avoidance litigation remain uncommenced
indefinitely, and if ever commenced, be conducted by an
overworked, underfunded litigation trustee -- is shameful," Mr.  
Winter says.

Mr. Winter assures the Court that no legitimate interest of any
Chapter 11 constituency is adversely affected if the Committee is
permitted to file a complaint and proceed, even if there might be
a litigation trustee at some future time.  That litigation
trustee will benefit from having the fruits of discovery, and
perhaps far more, years earlier than if the litigation trustee
had to begin from scratch when the trustee sprung into legal
existence. (Owens Corning Bankruptcy News, Issue No. 57;
Bankruptcy Creditors' Service, Inc., 609/392-0900)   


PENNSYLVANIA DENTAL: S&P Withdraws 'BB' Ratings at Co.'s Request
----------------------------------------------------------------
Standard & Poor's Rating Services withdrew its 'BB' counterparty
credit and financial strength ratings on Pennsylvania Dental
Service Corp., and its 'BB' financial strength ratings on DDP's
affiliates: Delta Dental of New York Inc., Delta Dental of
Delaware Inc., Delta Dental of West Virginia, and Delta Dental of
District of Columbia.

"The ratings were withdrawn at the company's request," explained
Standard & Poor's credit analyst Steven Ader.


PG&E NATIONAL: USGen Committee Hires Reed Smith as Counsel
----------------------------------------------------------
The Official Committee of USGen Unsecured Creditors wants Reed
Smith LLP to prosecute the interest of USGen's unsecured
creditors.  Reed Smith has extensive general experience and
knowledge, and in particular, is an expert in the fields of
debtor protection and creditors' rights and business
reorganizations under Chapter 11 of the Bankruptcy Code.  Reed
Smith also has substantial expertise in matters involving energy,
government regulations and litigation.  Reed Smith is one of the
25 largest firms in the United States.  

By this application, the USGen Creditors' Committee seeks the
Court's permission to retain Reed Smith as its counsel.  

Reed Smith is expected to:

   (a) advise the Committee with respect to its duties and
       powers;

   (b) consult with USGen concerning the administration of its
       case;

   (c) assist the Committee in its investigation of the acts,
       conduct, assets, liabilities, including USGen's financial
       condition and business operation, and the desirability of
       the continuation of such business, and any other matters
       relevant to the case or the formulation of a Plan;

   (d) prepare all necessary motions, applications, answers,
       orders, reports, or other papers in connection with the
       administration of USGen's estate;

   (e) receive any proposed Plan and Disclosure Statement,
       participate with USGen or others in the formulation or
       modification of a Plan, or propose a Committee Plan if
       appropriate; and

   (f) perform other legal services as may be required and in
       the Committee's interest.

Agnes L. Levy of JPMorgan Chase Bank, as Co-Chairperson of the
Committee, tells the Court that Reed Smith will be paid its
customary hourly rates, and reimbursed for expenses incurred in
its service to the Committee.  Reed Smith's current hourly rates
are:

                Partners              $275 - 500
                Associates             180 - 325
                Paraprofessionals      145 - 200

Francis P. Dicello, Esq., at Reed Smith LLP, assures Judge Mannes
that the firm does not represent any interest adverse to USGen
and its related companies. (PG&E National Bankruptcy News, Issue
No. 3; Bankruptcy Creditors' Service, Inc., 609/392-0900)    


PHOTOGEN: Enters Agreement to Cure Default Under Promissory Note
----------------------------------------------------------------
Photogen Technologies, Inc. (Nasdaq: PHGN) has reached an
agreement with Xmark Fund, L.P. and Xmark Fund, Ltd., to cure its
default under promissory notes held by Xmark.

Under the terms of the Agreement, Photogen will make an immediate
cash payment of $1,250,000 to Xmark, and Xmark will rescind the
default notice previously delivered to Photogen.  Photogen remains
obligated to make a second principal payment of $1,250,000 as set
forth in the original promissory notes held by Xmark, but it now
has the right to extend the due date monthly until April 3, 2004
for a fee ranging from $50,000 to $100,000 per month.

Other revisions to Photogen's prior agreement with Xmark include
changing Xmark's demand registration rights to piggy-back
registration rights and modifying the definition of "Event of
Default" in the security agreements securing Photogen's
obligations to Xmark.

Except as specifically amended by the Agreement, the terms of
Photogen's agreements with Xmark remain in effect, including
Xmark's put right with respect to Photogen stock Xmark owns.

In order to fund its obligations to Xmark, and for other working
capital purposes, Photogen borrowed an aggregate principal amount
of $1,484,000 from two of its investors.  In addition, Photogen
announced that Jonathan Fleming was officially appointed to its
board of directors recently, following his previously disclosed
acceptance of the appointment.

Photogen Technologies, Inc. develops and markets a platform of
innovative imaging products.  The company recently acquired the
medical imaging business of Alliance Pharmaceutical Corp., led by
Imagent(R) (perflexane lipid microspheres), an FDA approved
ultrasound imaging product.  Photogen's development programs use a
versatile iodinated nanoparticulate formulation that shows promise
as a subcutaneous, intravenous or intra-arterial agent for both
cardiovascular imaging and lymphography (the diagnosis of cancer
metastasizing to lymph nodes).  PH-50, which is entering Phase 1
clinical studies, has potential benefits when used with
conventional or computed tomography angiography to address the
need for early detection of coronary artery disease, cancer and
other diseases affecting the body's arteries and organs.  N1177,
which is entering Phase 2 clinical studies, has potential
applications for the diagnosis and staging of cancers such as
breast, prostate, lung, melanoma, uterine, cervical, and head and
neck cancer.


PILLOWTEX CORP: Court OKs Logan's Appointment as Claims Agent
-------------------------------------------------------------
Pillowtex Corporation and its debtor-affiliates obtained the
Court's permission to appoint Logan & Company, Inc. as Notice and
Claims Agent who will:

    -- assume responsibility for the distribution of notices;

    -- handle and administer claims in the Debtors' Chapter 11
       cases; and

    -- assist the Debtors with the preparation of their statements
       and schedules. (Pillowtex Bankruptcy News, Issue No. 48;
       Bankruptcy Creditors' Service, Inc., 609/392-0900)    


PRINCETON VIDEO: Completes Sale of Assets to PVI Virtual Media
--------------------------------------------------------------
Princeton Video Image, Inc. (OTCBB: PVII) has completed the sale
of substantially all of its assets pursuant to Section 363 of the
U.S. Bankruptcy Code to PVI Virtual Media Services, LLC, a newly
formed entity owned by Princeton Video Image's two secured
creditors and largest stockholders. PVI Virtual Media Services is
continuing Princeton Video Image's business under the name PVI.

PVI Virtual Media Services provided Princeton Video Image with
interim financing to fund its post-petition operating expenses. In
light of the completion of the asset sale, Princeton Video Image
expects to file shortly with the Bankruptcy Court a chapter 11
plan of liquidation that will distribute its remaining assets to
creditors in accordance with the U.S. Bankruptcy Code. It is
expected that there will be no distributions to Princeton Video
Image's shareholders under the plan and that Princeton Video Image
will subsequently be dissolved.

Operating under the name PVI, PVI Virtual Media Services is
continuing Princeton Video Image's business of providing real-time
virtual advertising, programming enhancements, virtual product
integration and targeted interactive services for televised sports
and entertainment events. It services the advertising industry
with its proprietary, Emmy award-winning technology. Headquartered
in New York City and Lawrenceville, New Jersey, it has offices in
Los Angeles, Toronto, Tel Aviv, Mexico City and Hong Kong.


PROTARGA: Selling Substantially All Assets to Spectrum for $2 Mil.
------------------------------------------------------------------
Protarga Inc., asks for authority from the U.S. Bankruptcy Court
for the District of Delaware to enter into an asset purchase
agreement selling substantially all its assets to Spectrum
Pharmaceuticals, Inc., for $2 million, subject to higher and
better offers.

The Debtor submits that the Asset Sale Agreement with Spectrum was
negotiated in good faith.  These negotiations have involved
substantial time and energy by the parties and their
professionals; indeed, the Purchase Agreement will reflect
negotiations and compromises on both sides.

In connection with the sale transaction, the Debtor will assume,
assign, and sell to the Spectrum all of the its interests in
certain executory contracts and other liabilities as agreed.

The Debtor reports that the Purchase Agreement was negotiated at
arm's length and in good faith by the Debtor and the Purchaser,
following thorough consideration of other possible alternatives by
the Debtor and its Board of Directors. The Debtor believes that
the price to be received for the Assets reflected in the Purchase
Agreement, subject to higher or better offers, will result in the
highest and best value for the Debtor's estate and its creditors
for such assets.

Assets included in the Sale are:

     i) all of the Debtor's intellectual property;

    ii) the Debtor's supply of drugs as well as data concerning
        the development and testing of said drugs;

   iii) by way of sale, assumption and assignment under Sections
        363 and 365 of the Bankruptcy Code, certain contracts as
        set forth in schedules affixed to the Purchase
        Agreement; and

    iv) assets excluded from the sale to the Purchaser include
        cash, the stock and ownership interests of the Debtor,
        bankruptcy avoidance claims and causes of action and the
        proceeds thereof, the corporate minute book of the
        Debtor and the other assets as described in the Purchase
        Agreement.

If the Debtor enters into an agreement in which the Assets are
sold to another purchaser and approved by the Court, then the
Debtor will pay a $200,000 break-up fee to Spectrum.

The Debtor tells the Court that after a thorough marketing effort,
and with the assistance of various advisors, it reviewed all of
its options and considered the costs and benefits of the proposed
transaction as compared with other alternatives. The Debtor
concluded that the benefits to be gained through the sale of the
Assets outweigh the benefits to be gained by retaining the assets.

Moreover, the Debtor believes that the value of the Assets will be
much higher as a going concern, rather than in a forced
liquidation. In addition, the Debtor has identified a purchaser
that, the Debtor believes, has the financial means to close the
Asset Sale.

Protarga, Inc., headquartered in King of Prussia, Pennsylvania, is
a clinical stage pharmaceutical company that is developing
Targaceutical(R) drugs for new medical therapies.  The Company
filed for chapter 11 protection on August 14, 2003 (Bankr. Del.
Case No. 03-12564).  Raymond Howard Lemisch, Esq., at Adelman
Lavine Gold and Levin, PC represents the Debtor in its
restructuring efforts.  When the Company filed for protection from
its creditors, it listed estimated assets of over $1 million and
estimated debts of over $10 million.


RAVEN MOON: June 30 Balance Sheet Upside-Down by $320,000
---------------------------------------------------------
Raven Moon Entertainment, Inc. (OTC Bulletin Board: RVNM) released
its financials for period ending June 30, 2003.  Raven Moon
Entertainment's financials showed a reduction in the company's net
loss of more than $1.7 million.

Raven Moon Entertainment reduced its debt significantly as a
result of the spin off of ClubHouse Videos Inc.  Raven Moon
restructured its business operations from day to day sales of
video, DVD, and CD products inspired by "Gina D's Kids Club",
which is now handled by ClubHouse Videos, to a company which is
focused on television production and syndication.

Raven Moon's revenue stream will now be derived from larger
purchase orders and the assignment of rights to manufacture and
distribute products which are inspired by the show.  The
assignment of these rights resulted in over $780,000 in revenue
during the first quarter, with the other revenue resulting from
the sale of the "Cuddle Bug" plush toys by JB Toys, a wholly owned
subsidiary.  As a result, Raven Moon's gross profit is up
significantly from the year prior; $857,173 for 6 months period
ended June 30, 2003 as compared with just $6,865 for 6 months
ended June 30, 2002.

Raven Moon Entertainment's June 30, 2003 balance sheet shows a
total shareholders' equity deficit of about $320,000.

Raven Moon recently announced that it has extended the record date
for Raven Moon shareholders to receive the 1 for 1 stock dividend
for all shareholders of record from August 20, 2003 to September
19th, 2003.  Raven Moon rescheduled the shareholder meeting for
September 12, 2003.  The 1 for 1 stock dividend for all
shareholders of record as of September 19th, 2003 is based upon
shareholder approval to increase the authorized share total at the
September 10 shareholder meeting.  The distribution date for the
shareholder dividend will be October 1, 2003.

Raven Moon is encouraging its shareholders to attend the annual
shareholder meeting or fax their proxies directly to ADP (631)
254-7760.  For more information please contact 407-877-5952.

Visit http://www.knobias.comfor Raven Moon Entertainment's  
complete financials.


RIBAPHARM INC: ICN's Tender Offer for Ribapharm Shares Completed
----------------------------------------------------------------
ICN Pharmaceuticals, Inc. (NYSE: ICN) announced the successful
completion of its cash tender offer of $6.25 per share for all of
the outstanding shares of common stock of Ribapharm Inc. (NYSE:
RNA), that ICN does not already own.  ICN's offer expired at 5:00
p.m., New York City time, on Tuesday, August 19, 2003.

According to American Stock Transfer & Trust Company, the
Depositary for the offer, as of the expiration of the offer,
approximately 20,729,347 Ribapharm shares had been tendered and
not withdrawn pursuant to the offer (including guaranteed
deliveries), representing approximately 69.33% of the outstanding
shares of Ribapharm not owned by ICN.  ICN has accepted for
payment all such shares in accordance with the terms of the offer
and payment for these shares will be made promptly.

As previously announced, ICN intends to promptly effect a "short-
form" merger in which any shares not already owned by ICN or
acquired in the offer will be acquired at the same $6.25 per share
cash price paid in the offer. Transmittal materials will be sent
to Ribapharm stockholders following the merger.

ICN is an innovative, research-based global pharmaceutical company
that manufactures, markets and distributes a broad range of
prescription and non-prescription pharmaceuticals under the ICN
brand name.  Its research and new product development focuses on
innovative treatments for dermatology, infectious diseases and
cancer.

Ribapharm, whose March 31, 2003 balance sheet shows a total
shareholders' equity deficit of about $335 million, is a
biopharmaceutical company that seeks to discover, develop, acquire
and commercialize innovative products for the treatment of
significant unmet medical needs, principally in the antiviral and
anticancer areas.


ROMACORP INC: Advances Plan to Restructure 12% Senior Notes
-----------------------------------------------------------
Romacorp, Inc., operator and franchisor of Tony Roma's
restaurants, continues to make progress in its program to
strengthen its financial position and has reached agreement with
the holders of more than 80% of its outstanding 12% Senior Notes
due July 1, 2006 with respect to a plan to restructure the
outstanding Senior Notes.

Romacorp previously announced that it had engaged Houlihan Lokey
Howard & Zukin Capital as its financial advisor to evaluate a
number of alternatives as it seeks greater financial flexibility
to reinvest in its business to create a solid platform for growth.
The Lockup and Voting Agreement announced today specifies, among
other things, that Romacorp's Senior Notes shall be refinanced
with a combination of cash and newly issued notes of Romacorp
pursuant to an out-of-court exchange offer or a bankruptcy filing.
The refinancing would reduce the Company's cash interest expense.
The Company is unable to predict the likelihood of success of the
restructuring plan.

"We have been working closely with our outside advisors and
noteholders in order to strengthen our financial position and we
are pleased to have reached this significant milestone," said
David W. Head, CEO and President. "We still have significant
challenges in front of us, but are optimistic we can successfully
complete this process. Restructuring our debt burden would benefit
all of our stakeholders by giving us the flexibility we need to
make necessary investments for our concept and future growth."

"While our financial and legal teams have been working hard on our
financial restructuring, our operations, R&D and marketing teams
are focused on the single-minded goal of improving the dining
experience of our guests," added Mr. Head. "Since my arrival in
late June, we have focused on raising the bar and we are already
seeing improvements in a number of areas."

Romacorp also said that Frank Steed has left his position as
President of its franchise subsidiaries and member of the
Company's Board of Directors and will serve the Company as a
franchise consultant. "This gives Frank the opportunity to pursue
business opportunities outside of the Company," said Mr. Head. "We
greatly appreciate his many contributions to Tony Roma's and will
continue to utilize his vast experience in our franchising
efforts."

Romacorp, Inc. operates and franchises Tony Roma's restaurants,
the world's largest casual dining restaurant chain specializing in
ribs. The Company operates 42 restaurants and franchises 214
restaurants in 28 states and 27 foreign countries and territories.


SECURED SERVICES: Hires J.H. Cohn as Grant Thornton Replacement
---------------------------------------------------------------
Grant Thornton LLP, independent certified public accountants of
Baltimore, Maryland, audited the balance sheets of Secured
Services, Inc. (formerly known as Southern Software Group, Inc.,)
a Delaware corporation, as of December 31, 2002 and 2001, and the
related statements of operations, stockholders' deficit, and cash
flows for the years then ended.

During July 2003, management of the Company consulted with a
representative of J.H. Cohn LLP, independent public accountants,
of Roseland, New Jersey, for the purpose of determining whether J.
H. Cohn LLP would be interested in becoming the Company's new
independent public accountants.

On August 13, 2003, the Company engaged J. H. Cohn LLP as the
Company's new independent accountants and dismissed Grant Thornton
LLP. The decision to change accountants was recommended and
approved by the Company's Board of Directors.

During the two years ended December 31, 2002 and during the
subsequent period through August 13, 2003, the reports of Grant
Thornton LLP expressed that there was substantial doubt about the
Company's ability to continue as a going concern.


SEROLOGICALS: Completes 4.75% Convertible Debentures Offering
-------------------------------------------------------------
Serologicals Corporation (Nasdaq/NM:SERO) has completed
offering of $130 million aggregate principal amount of its 4.75%
Convertible Senior Subordinated Debentures due 2033 in a private
placement pursuant to Rule 144A under the Securities Act of 1933,
as amended.

The debentures issued today include $20 million of debentures
pursuant to the exercise in full of an option that Serologicals
had granted to the initial purchasers of the debentures. Subject
to the satisfaction of certain conditions, the debentures will be
convertible into shares of Serologicals common stock at an initial
rate of 67.6133 shares of common stock per $1,000 principal amount
of debentures (or a conversion price of approximately $14.79 per
share of common stock). The conversion rate is subject to
adjustment.

The debentures have been offered only to qualified institutional
buyers in reliance on Rule 144A under the Securities Act. The
debentures have not been registered under the Securities Act or
any state securities laws. Unless so registered, the debentures
may not be offered or sold in the United States except pursuant to
an exemption from the registration requirements of the Securities
Act and applicable state securities laws.

Serologicals Corporation, headquartered in Atlanta, Georgia, is a
global provider of biological products and enabling technologies,
which are essential for the research, development and
manufacturing of biologically based life science products. The
Company's products and technologies are used in a wide variety of
innovative applications within the areas of oncology, hematology,
immunology, cardiology and infectious diseases, as well as in the
study of molecular biology. Serologicals has more than 900
employees worldwide, and its shares are traded on the NASDAQ
national stock market under the symbol "SERO."

As reported in Troubled Company Reporter's Wednesday Edition,
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit and 'BB-' senior secured ratings and assigned its 'B-'
rating to Serologicals Corporation's proposed $110 million
convertible senior subordinated debentures due 2033. The outlook
is stable.


SIMTROL INC: Completes Sale of 1.7M Shares via Private Placement
----------------------------------------------------------------
On August 7, 2003, Simtrol, Inc., completed the sale of 1,734,167
of restricted common shares for aggregate gross proceeds of
$416,200, in a private placement of its stock to a limited number
of accredited investors, including three Board members. The share
price was $0.24 per share. Offering costs were de minimis. The
proceeds of the offering were used to fund operational and
overhead expenses of the Company from the period November 29, 2002
through August 7, 2003.

Simtrol, Inc., an Atlanta-based holding company, was incorporated
under the laws of Delaware on September 19, 1988 as Fi-Tek III,
Inc. to raise capital and to seek out business opportunities in
which to acquire an interest. On August 21, 1990, the Company
acquired 89.01% of the total common stock and common stock
equivalents then issued and outstanding of Videoconferencing
Systems, Inc., a Delaware corporation. Videoconferencing Systems
was founded in 1985 through the acquisition of a portion of the
assets of a Sprint Corporation videoconferencing subsidiary. In
December 1990, the name was changed from Fi-Tek III, Inc. to VSI
Enterprises, Inc. During the first half of 1991, the Company
acquired the remaining additional outstanding shares of common
stock of Videoconferencing Systems. In September 2001 the name was
changed from VSI Enterprises, Inc. to Simtrol, Inc.

The Company is a software technology company specializing in
Audiovisual control. Previously, we primarily designed,
manufactured, marketed and supported software-based command and
control systems, including videoconferencing control systems. We
still provide maintenance support for certain of these systems. We
also conducted business under VSI Network Solutions, Inc., a
majority owned subsidiary, doing business as Eastern Telecom,
which was engaged in the business of marketing and selling
telecommunications services and products. On February 18, 2000, we
entered into a definitive agreement to sell Eastern Telecom, which
was completed on May 18, 2000.

Its principal executive offices and manufacturing facilities are
located at 2200 Norcross Parkway, Suite 255, Norcross, Georgia
30071, and our telephone number is (770) 242-7566.

In its Form 10-K filed with Securities and Exchange Commission,
the Company reported"

                      Recent Developments

"During 2002, we continued our previously announced plan to
restructure our company around the sales of the company's ONGOER
PC-based control software. The product was originally available
for sale in April 2001 and represented a departure for the company
from its previous business of selling, installing, and servicing
its Omega videoconferencing control systems. The company no longer
sells videoconferencing systems directly, however, the company
still maintains service contracts with certain videoconferencing
customers.

"Due to the discontinuance of the company's older Omega product
line of videoconferencing systems and the slower than anticipated
increase in sales of ONGOER, in June 2002 we reduced our headcount
by approximately 50% in order to conserve resources and focus our
sales and development efforts with select audiovisual integrators
and on software licensing opportunities in order to reduce our
cash used from operations. The company also moved to significantly
smaller office space in September 2002 to reduce overhead
expenses.

"These changes were necessary because during the year following
the launch of ONGOER 1.0, we learned that integrators would have
to change the way they sell, design, program, invoice, install,
and support control system solutions should they wish to use the
PC-based ONGOER product. Despite obvious benefits to moving
to a PC-based solution, a complete overhaul of internal operations
was simply not a choice integrators were willing to make during an
uncertain economic climate.

"Despite reduced headcount and major reduction in expenses, the
company retained its top software talent and focused on adding
important software features to enhance the product. During the
second half of 2002, success on two important fronts took place.
First, the company announced its first licensing agreement with
Polycom, the world's largest videoconferencing company. Under its
agreement with Polycom, the company licenses certain ONGOER code
for use in Polycom's PC-based iPower videoconferencing platform.
This software provides Polycom's customers with control
capabilities for three serial devices - a VCR, projector and
document camera. This partnership with Polycom has provided
credibility to the company's software through a proven market
leader and has provided for increased exposure to AV integrators
interested in exploring PC-based solutions.

"Second, the company has established a strong partnership with
Telaid, a Connecticut-based systems integration and service firm.
Together, Telaid and Simtrol have successfully deployed sixteen
ONGOER units at Morgan Stanley. The Morgan Stanley account was
instrumental in shaping the company's second software product -
OnGuard monitoring software. Success at Polycom and Telaid has
provided the company with increased visibility in the AV
integration community, strong reference accounts and valuable
feedback on additional software features that will further enhance
the ONGOER and OnGuard products.

"The company issued additional convertible notes and private
common stock during the year to fund its operations, however, the
company continues to use significant cash in operations and
requires additional debt or equity financing. This additional
financing could be in the form of the sale of assets, debt,
equity, or a combination of these financing methods. The amount of
such funding that may be required will depend primarily on how
quickly sales of our ONGOER product take place and to what extent
we are able to work out our overdue accounts payables with our
various vendors. There can be no assurance that we will be able to
obtain such financing if and when needed, or that if obtained,
such financing will be sufficient or on terms and conditions
acceptable to us. If we are unable to obtain this additional
funding, our business, financial condition and results of
operations would be adversely affected.

"As of December 31, 2002, we had cash and cash equivalents of
$1,307. We do not have sufficient funds for the next 12 months and
have relied on periodic investments in the form of common stock
and convertible debt by certain of our existing shareholders since
the fourth quarter of 2001. We currently require substantial
amounts of capital to fund current operations and for the payment
of past due obligations including payroll and other operating
expenses and the continued development and deployment of our
Ongoer product line. Our inability to pay our audit fees on a
timely basis resulted in the delay of the audit's completion for
2002. Due to recurring losses from operations, an accumulated
deficit, negative working capital and our inability to date to
obtain sufficient financing to support current and anticipated
levels of operations, our independent public accountant's audit
opinion states that these matters have raised substantial doubt
about our ability to continue as a going concern at December 31,
2002 and 2001."


SOLUTIA INC: Strikes Settlement of Alabama PCB Litigation
---------------------------------------------------------
Solutia Inc. (NYSE: SOI) (S&P, B- Corporate Credit Rating,
Negative) announced a settlement resolving the Abernathy and
Tolbert PCB litigation against the Company in Alabama.

The settlement, which includes no admissions of wrongdoing, will
be funded by Solutia, Monsanto Co. and Pharmacia, a wholly-owned
subsidiary of Pfizer and the companies' commercial insurers.  It
resolves all outstanding claims including potential punitive
damages that might have been sought by plaintiffs and their
lawyers.  Solutia's portion of the settlement will be $50 million
paid in equal installments over a period of 10 years.

"We are glad to have this litigation behind us as it removes a
burden for the Company, its employees and stakeholders; and the
community of Anniston, Alabama," said John C. Hunter, chairman and
chief executive officer.  "This settlement puts the Company in a
better position in the coming months to refinance its bank
facility and to address upcoming bond maturities, pension funding
obligations and other legacy liabilities."

Mr. Hunter added, "While there is substantial scientific evidence
which demonstrates that exposure to PCBs does not cause serious
long-term health impacts to people, continuing to battle these
matters in the courts would have taken many years and would have
continued to drain the resources of the Company and the vibrancy
of the Anniston community."

The settlement, which concludes these cases in state and federal
court, respectively, resulted from mediation conducted by The
Honorable U.W. Clemon, Senior Judge, United States District Court
for the Northern District of Alabama, and The Honorable R. Joel
Laird, jr., State Circuit Court Judge, Calhoun County, Alabama.  
Participants in the mediation included Solutia, Monsanto,
Pharmacia and lawyers for the plaintiffs.

"We commend the judges for their professionalism and even-
handedness in bringing about a resolution of these cases.  We
share their vision that by solving these matters, it will allow
the community to begin a healing process," Mr. Hunter said.

The terms of the agreement were stipulated by all parties in a
court session Wed., Aug. 20, 2003 before the respective judges in
the two cases. The settlement is subject to the parties entering
into a final agreement and approval by the court which are
expected by Aug. 26, 2003, with funds being transferred by
Aug. 29, 2003.

The cash settlement totals $600 million, with Solutia's $50
million portion to be paid over time.  Approximately $160 million
of the cash settlement will be provided through the settling
Companies' commercial insurance.  The remaining approximately $390
million will be provided by Monsanto.

In addition, as part of the settlement, Solutia arranged for a
broad array of community health initiatives for low-income
residents of Anniston and Calhoun County to be undertaken by
Pfizer Corporation.  These programs are valued at more than $75
million over the next 20 years.

Solutia has also agreed to issue Monsanto warrants to purchase 10
million shares of Solutia common stock.  The warrants are
exercisable if Solutia's common stock reaches a certain price
target or upon a change-of-control of Solutia.

"Solutia and Monsanto Company, now known as Pharmacia, have acted
responsibly as producers and employers in the Anniston, Alabama
community. Solutia plans to remain an integral part of the
community.  Judge Clemon's recent approval of a Consent Decree
between Solutia, the EPA and the Department of Justice allows the
Company to proceed with an expedited residential cleanup in
Anniston, while simultaneously developing a comprehensive cleanup
plan for the community," Mr. Hunter noted.

Solutia -- http://www.Solutia.com-- uses world-class skills in  
applied chemistry to create value-added solutions for customers,
whose products improve the lives of consumers every day.  Solutia
is a world leader in performance films for laminated safety glass
and after-market applications; process development and scale-up
services for pharmaceutical fine chemicals; specialties such as
water treatment chemicals, heat transfer fluids and aviation
hydraulic fluid and an integrated family of nylon products
including high-performance polymers and fibers.


SPIEGEL GROUP: Esplanade Demands Tax Payment Amounting to $1MM++
----------------------------------------------------------------
Esplanade at Locust Point-II Limited Partnership and The Spiegel
Debtors are parties to a Lease Agreement dated March 1, 1990
amended by the Option Agreement.  Pursuant to the Lease, Esplanade
constructed a 570,000-square foot building located at 3500 Lacey
Road in Downers Grove, Illinois, which the Debtors continue to
use as their corporate headquarters.  The monthly rent reserved
under the Lease is $1,138,328 and is based on Esplanade's
construction costs for the building.  The initial 20-year term of
the Lease expires on March 31, 2012.  The Lease grants the
Debtors four successive renewal options -- each for a five-year
term.

Under the Lease, the Debtors are obligated to pay all taxes
assessed against the Esplanade Building.  Both parties have
agreed that the Debtors' tax obligation arises during the year in
which the taxes are levied.  Moreover, because the Debtors' tax
liability for the final year of the Lease would not be known, and
thus would not arise until after the termination, they agreed
that their tax obligation would survive termination of the Lease.

Ira L. Herman, Esq., at Bryan Cave, in New York, relates that
under the laws of the State of Illinois, the taxpayer is billed,
and the obligation to pay property taxes arises in the year
following the year in which the taxes accrue.  In DuPage County,
where the Esplanade Building is located, half of the previous
year's taxes are payable by no later than the first business day
of June, as evidenced by the Tax Bills.  The balance of the taxes
must be paid by no later than the first business day of
September.  Tax payments made after those dates are subject to
late payment penalties.

                           Sublease Bond

Ms. Herman also relates that pursuant to a sublease between the
Debtors and Continental Casualty Company dated as of August 18,
1999, the Debtors subleased 138,317 square feet on three floors
of the Esplanade Building to Continental.  The term of the
Sublease is for 10 years.

Esplanade consented to the Sublease on the condition that the
Debtors post a $12,144,786 lease bond to secure all of their
obligations under the Lease.  The amount of the Lease Bond
decreases each June.

In May 2003, DuPage County issued two tax bills for the Esplanade
Building.  The Tax Bills levied for 2002 are:

   (a) taxes amounting $16,526 -- half of which were to be paid
       by June 2, 2003 and the other half to be paid by
       September 2, 2003; and

   (b) taxes amounting $1,191,362 -- half of which were to be
       paid by June 2, 2003 and the other half to be paid by
       September 2, 2003.

By letter dated May 21, 2003, Ms. Herman reports, the Debtors
notified the DuPage County Collector that they would not pay the
Tax Bills.  To avoid late payment penalties, Esplanade paid
$603,718 of the Debtors' tax obligation by checks dated May 28,
2003.  The other $603,718 tax payment must be paid by the
appointed date to avoid payment penalties.

Ms. Herman points out that the Debtors continue to enjoy the
benefit of their bargain under the Lease, remaining in possession
of their corporate headquarters while they decide whether to
assume or reject the Lease.  However, Esplanade believes that the
Debtors ultimately intend to reject the Lease, as the Debtors are
paying above market rent and are actively searching for
alternative premises for their corporate headquarters.

By this motion, Esplanade asks the Court to:

   (a) compel the Debtors to immediately reimburse them for the
       Tax Payment; and

   (b) determine that the remaining tax obligation constitutes a
       postpetition obligation, pursuant to Section 365(d)(3) of
       the Bankruptcy Code, which must be borne by the Debtors.

Ms. Herman argues that the Court must protect Esplanade as the
Debtors' commercial landlord and grant it the benefit of the
bargain, by requiring the Debtors to pay the tax obligation which
arose, and which the Debtors were not contractually obligated to
pay until after the Petition Date.

Section 365(d)(3) requires a debtor to timely perform all of its
postpetition obligations under an unexpired non-residential real
property lease, until the lease is either assumed or rejected.  
Courts, however, have split on what type of claim a landlord has
for obligations that come due in the postpetition period.

Ms. Herman relates that before the Third Circuit and Sixth
Circuit decisions embracing a "billing date" method for
determining a debtor's liability for obligations coming due
postpetition, one circuit court and several district and
bankruptcy courts, including the New York Court, adopted an
"accrual method."  The "accrual method" courts rely heavily on
legislative history of Section 365(d)(3) in requiring payment for
only those obligations accruing during the postpetition, pre-
rejection period, regardless of the billing date.  Thus, these
courts prorate the debtor's lease obligations between the
prepetition and postpetition periods.

Nevertheless, even if the New York Court were to accept the
"accrual method" courts' position regarding legislative ambiguity
and the need to consult legislative history, Ms. Herman tells
Judge Blackshear that the legislative history of Section
365(d)(3) supports the "billing date" approach.  In a House
Report adopting the amendments to Section 365(d)(3), Senator
Orrin Hatch stated:

    "[t]he bill would lessen these problems by requiring the
    trustee to perform all the obligations of the debtor under a
    lease of nonresidential real property at the time required in
    the lease.  This timely performance requirement will ensure
    that debtor-tenants pay their rent, common area, and other
    charges on time pending the trustee's assumption or rejection
    of the lease."

Ms. Herman explains that the Tax Obligation did not arise until
the taxes were levied in May 2003, after the Petition Date.  Had
Esplanade asked the Debtors to make the tax payment during the
prepetition period, the Debtors would have certainly objected,
contending that it was not yet legally obligated to make the
requested payment.  On the other hand, Esplanade surely could not
have evicted the Debtors during the 2002 calendar year or drawn
down on the Lease Bond for failure to pay taxes not yet levied,
since Esplanade would not have been able to declare the Debtors'
failure to make tax payment during the prepetition period a
default.  Ms. Herman emphasizes that this is significant, because
the Debtors would have had to replenish the bond in the full
amount of the draw, thus preserving the entirety of the bond for
future defaults, including the one that will be occasioned by
Spiegel's rejection of the Lease.

Now that the taxes have been levied postpetition, Spiegel was
obligated to make the first installment payment before June 2,
2003.  Consequently, the Court must direct Spiegel to immediately
reimburse Esplanade for the Tax Payment.  Furthermore, the
Remaining Tax Obligation is now due and payable by the Debtors
and must be paid by September 2, 2003 so as to avoid penalties.
(Spiegel Bankruptcy News, Issue No. 10; Bankruptcy Creditors'
Service, Inc., 609/392-0900)   


STRUCTURED ASSET: Fitch Upgrades Class I Note Rating to BB+
-----------------------------------------------------------
Structured Asset Securities Corp's multiclass pass-through
certificates, series 1996-CFL are upgraded by Fitch Ratings as
follows:

   --$96 million class G to 'AAA' from 'AA';

   --$48 million class H to 'AA' from 'BBB+';

   --$67.2 million class I to 'BB+' from 'BB-'.

In addition, Fitch affirms the following classes:

   --$4 million class E 'AAA';

   --$57.6 million class F 'AAA';

   --Interest-only classes X-1 and X-2 'AAA'.

Fitch does not rate the $37 million class J or the $287,866
million class P certificates. The rating actions follow Fitch's
review of the transaction, which closed in February 1996.

The upgrades reflect increases in subordination levels due to
amortization and loan payoffs. As of the July 2003 distribution
date, the pool's certificate balance has declined by 83%, to $310
million from $1.93 billion at issuance. Midland Loan Services,
L.P., the master servicer, collected year-end 2002 financials for
79% of the pool's balance. Based on the information provided, the
pool's weighted average debt service coverage ratio increased to
1.49 times as of YE 2002 from 1.31x at issuance.

Of the 470 loans that have paid off, 16 had realized losses, in
total $22.8 million, or 1.2% of the original principal balance.
Eight loans (14%) are currently being specially serviced by Lennar
Partners, Inc., including a 60-days delinquent (1.1%), two in
foreclosure (1.5%) and two real estate owned loans (2.3%).

The largest specially serviced loan (7.5%) is secured by a 1.5
million square foot Kmart distribution facility in Ocala, FL. The
loan is current and the servicer is negotiating a loan workout.

The largest REO loan (1.4%) is secured by an office property in
Sarasota, FL. The property is currently 70% occupied and the
property manager is preparing a business plan. Losses are
expected.

Fitch applied various stress scenarios taking into consideration
all of the above concerns. Even under these scenarios,
subordination levels remain sufficient to upgrade classes G, H,
and I and affirm the remaining classes.

Fitch will continue to monitor this transaction, as surveillance
is ongoing.


TOP FURNITURE: Begins Store Closing Sales at All Calif. Stores
--------------------------------------------------------------
Store closing sales have just started at all Top Furniture
Company, Inc. stores. These stores have operated under the trade
name of Sofas & More, Top Furniture and Woodworks Furniture. Top
Furniture was the largest independently owned furniture chain in
Northern California. This family owned business has been in
operation for over 50 years.

Top Furniture selected Hilco Merchant Resources to conduct the
sale at all locations. The selection was approved by The United
States Bankruptcy Court for the Northern District of California.

Over $3 million of inventory will be liquidated during the sale
period. Liquidated will be all sofas, sectionals, chairs, tables,
beds, leather furniture recliners and much more.

Currently, signs are being hung in the stores and deep discounts
are being taken on all merchandise in these closing stores.
Consumers will be able to take advantage of substantial discounts
on all the inventory.

Anton Caracciolo, Executive Vice President of Hilco Merchant
Resources stated, "We are extremely pleased to have been selected
to participate in this important project. Hilco Merchant Resources
has been a strategic partner to many fine firms in the furniture
industry that have restructured or changed directions."

"I urge customers to come in now for the best selection. Such
brands as Benchcraft, Palliser, Rowe, Berkline and Guildcraft are
now on sale."

Based in Northbrook, IL, Hilco Merchant Resources provides high
yield strategic retail inventory liquidation and store closing
services. Over the years, Hilco principals have disposed of assets
valued in excess of $30 billion. Hilco Merchant Resources is part
of the Hilco Organization, a provider of asset valuation,
acquisition, disposition and financing to an international
marketplace through eight specialized business units. Hilco serves
retailers, manufacturers, wholesalers, distributors and importers,
direct and through their financial institutions and consulting
professionals. Services include: retail store, warehouse and
factory closings, and inventory liquidations, through sales and
auctions; asset appraisals covering retail and industrial
inventory, machinery, equipment, accounts receivables and real
estate; disposition of commercial and industrial real estate and
leaseholds; purchase and liquidation of distressed accounts
receivables portfolios; acquisition and re-marketing of excess
wholesale consumer goods inventories; and secured debt and equity
financing. The Hilco organization, headquartered in Chicago, has
offices in Boston; New York; Los Angeles; Miami; Atlanta;
Flagstaff; Detroit; and London, England. For more information
visit Web site at http://www.hilcotrading.com  


TRUMP HOTELS & CASINO: Intends to Pursue Illinois Gaming License
----------------------------------------------------------------
Trump Hotels & Casino Resorts, Inc. (NYSE: DJT) intends to pursue
an Illinois gaming license for a riverboat gaming facility in
South Suburban Chicago in alliance with the South Suburban
communities of Crestwood, Riverdale, Blue Island, Ford Heights,
Alsip, Midlothian, Posen, Robbins, Calumet Park and Phoenix.

Donald J. Trump, Chairman, President and Chief Executive Officer,
commented, "I look forward to providing our gaming, hotel and
resort development expertise to these fine communities. We believe
a riverboat gaming facility in this area is true to the
legislative intent of the Riverboat Gaming Act in that it will
provide an economic boost to an area where the recent economic
downturn has been acutely felt."

Crestwood Mayor Chester Stranczek said, "The ancillary development
associated with a South Suburban gaming project will create
significant new business and job opportunities, both construction
and ongoing, many of which would be filled by the citizens of the
greater South Suburbs, to replace the many jobs which have left
the area over the years and help the South Suburbs regain its
historic economic vitality."

The Trump/South Suburban Group did not participate in the most
recent Emerald Casino bid process given its belief that the
process was flawed. "It ignored the desires of the Illinois Gaming
Board in failing to provide first for the needs of the State,"
said Mayor Stranczek. "I agree with Mayor Stranczek that the needs
of the State and the will of the Illinois Gaming Board should
prevail in the Emerald proceedings and give our group an equal
opportunity to obtain a license for a riverboat gaming facility,"
added Mr. Trump.

THCR, through its wholly-owned subsidiaries, owns and operates
Trump Plaza Hotel and Casino, Trump Taj Mahal Casino Resort and
Trump Marina Hotel Casino in Atlantic City, New Jersey, as well as
Trump Indiana Riverboat Casino and Hotel at Buffington Harbor in
Indiana. The Company, through a wholly-owned subsidiary, also
manages Trump 29 Casino located near Palm Springs, California.

As previously reported in Troubled Company Reporter, Standard &
Poor's Ratings Services assigned its 'B-' corporate credit and
senior secured debt ratings to Trump Casino Holdings LLC, the
newly formed parent company of Trump Marina Associates L.P.
(formerly Trump Castle Associates L.P.), Trump Indiana Inc., and
Trump Management Services LLC.

Standard & Poor's also assigned its 'B-' rating to the new $420
million first priority mortgage notes due March 15, 2010, and its
'CCC' rating to the new $50 million second priority mortgage notes
due September 15, 2010, that will be jointly issued by TCH and its
subsidiary, Trump Casino Funding Inc. Moreover, an affiliate of
TCH has agreed to purchase an additional $15 million aggregate
principal amount of second priority mortgage notes. The outlook is
stable.

At the same time, Standard & Poor's placed its 'CCC' corporate
credit rating for TCH affiliate, Trump Atlantic City Associates,
on CreditWatch with positive implications.


UNITED AIRLINES: Committee Wants to Expand KPMG Engagement Scope
----------------------------------------------------------------
The Official Committee of Unsecured Creditors of United Airlines
Debtors, seeks the Court's authority to revise the scope of KPMG's
retention as accountants and restructuring advisors.

KPMG could benefit the Committee by assisting the Debtors and
their professionals, including accountants Deloitte & Touche, in
recovering tax refunds in California and Illinois.  KPMG is
familiar with the Committee, the Debtors and the relevant state
taxing authorities.

Dana J. Lockhart, Chairperson of the Committee, says that KPMG
will provide additional services in connection with these two
projects:

1) The Illinois Project

   a) review and analyze intercompany transactions and activities
      in the Debtors' non-transportation services Illinois
      unitary group;

   b) review approaches recommended by the Debtors' Professionals
      in the computation of gross receipts and apportionment
      factor for Illinois income tax purposes for United's non-
      transportation services Illinois unitary group;

   c) assist and review the analysis of potential refunds
      associated with any revised computation of the Illinois  
      apportionment factor and gross receipts;

   d) assist in preparation of technical documentation on the  
      revised approach to computations;

   e) assist the Debtors' Professionals in compilation of a
      report that quantifies the amount of potential Illinois
      income tax refund opportunities;

   f) discuss with the Debtors' Professionals which items will be  
      included in a "claim for refund" to be filed with the  
      Illinois Department of Revenue;

   g) assist the Debtors' Professionals in meeting with the Legal  
      Services Bureau of the Illinois Department of Revenue to  
      review United's state tax apportionment position and  
      refund opportunities;

   h) assist the Debtors' Professionals in meeting with the Legal  
      Services Bureau of the Illinois Department of Revenue if  
      positions are not accepted and in petitioning for  
      alternative allocation under Illinois Income Tax Act  
      Section 304(f);

   i) assist in obtaining a Private Letter Ruling, if
      appropriate;

   j) assist in preparing one or more "claim for refund"
      package(s);

   k) assist in communicating with the Illinois Department of  
      Revenue while considering the refund claim; and

   l) assist in matters before state taxing authority during  
      review of United's claims for refund.

2) The California Project

   a) discuss the jurisdictions the Company may seek property tax
      refunds and/or abatements as a result of the value of  
      computer software on Company aircraft;

   b) assist in determining the value of improperly assessed  
      software in flight and ground property and develop state  
      specific strategies for eliminating it from United's  
      assessments;

   c) provide proactive consulting to the Debtors Professionals  
      to help eliminate business personal property tax  
      assessments on application software; and

   d) if requested, KPMG will attend informal meetings and  
      administrative hearings before state and local authorities  
      and jurisdictions, according to established local  
      requirements and procedures.

KPMG will not duplicate the services that Saybrook Capital
provides to the Committee.  KPMG's compensation will be similar
to that approved in the initial engagement.  (United Airlines
Bankruptcy News, Issue No. 25; Bankruptcy Creditors' Service,
Inc., 609/392-0900)   


US AIRWAYS: Resolves Itochu Airlease and Chuo Mitsui Claims
-----------------------------------------------------------
Itochu Airlease Holdings, Inc. asserted Claim Nos. 2836 and 2837
each for $28,446,495 against the Reorganized US Airways Debtors on
account of aircraft bearing registration numbers N433US and
N653US.

Chuo Mitsui Trust and Banking Co., Ltd. filed Claim No. 2838 for
$54,574,172 against the Reorganized Debtors, also relating to
Tail Nos. N433US & N653US.  However, on February 25, 2003, Itochu
filed a Notice of Transfer of Claim pursuant to Rule 3001(e)(2)
of the Federal Rules of Bankruptcy Procedure indicating that
Claim No. 2838 had been transferred from Chuo Mitsui to Itochu.

On November 1, 2002, Wilmington Trust Company, as Indenture/
Security Trustee, filed Claim No. 4011, which also included
amounts relating to Tail Nos. N433US & N653US.  On January 24,
2003, the Reorganized Debtors objected to Claim Nos. 2836, 2837
and 2838.

After arm's-length negotiations, the parties have reached a
resolution to settle the disputes.  Claim Nos. 2836 and 2837 are
withdrawn.  Claim No. 2838 is allowed for $53,209,657 as a
general unsecured Class USAI-7 Claim.  All other claims filed by
Itochu or Chuo Mitsui are disallowed.  Claim No. 4011 is
partially withdrawn in the amount of $63,630,502.  All other
general unsecured claims of the Trustee that relate to Tail Nos.
N433US and N653US are disallowed. (US Airways Bankruptcy News,
Issue No. 36; Bankruptcy Creditors' Service, Inc., 609/392-0900)


U.S. ENERGY: Plans to Sell Certain Assets to Improve Financials
---------------------------------------------------------------
U.S. Energy Systems, Inc. (Nasdaq: USEY), a provider of customer-
focused energy solutions, announced financial results for the
second quarter ended June 30, 2003.

                        Financial Results

Consolidated revenues totaled $10,657,000 for the second quarter
ended June 30, 2003, a decrease of 1.1% when compared with the
prior year period in 2002.  Consolidated revenues were essentially
flat as increases in revenues from core operations were largely
offset by revenue reduction due to the sale of USE Enviro in the
second quarter of 2002. Total revenues increased by 9% in the six
months ended June 30, 2003 from the six months ended June 2002,
mainly due to increased sales at U.S. Energy Biogas and USE
Canada.  Consolidated net income rose to $1,699,000 in the second
quarter ended 2003, as compared with net income of $488,000 in the
prior year period. This increase in net income was largely due to
a gain from the sale of the Company's interest in US Energy
Geothermal LLC in the current reporting period. Earnings per fully
diluted share were $0.10 in the second quarter 2003, compared with
earnings per fully diluted share of $0.03 in the prior year
period.

At the end of the second quarter 2003, the Company sold its 95%
membership interest in Geothermal LLC to a subsidiary of Ormat
Nevada, Inc. for cash consideration of approximately $1 million.
The transaction resulted in an after tax gain of $1,419,000 in the
second quarter of 2003.  As part of the sale agreement, the
Company has been indemnified by the purchaser and Ormat Nevada,
Inc. of certain liabilities up to the amount of the purchase
price, including liabilities related to the pending lawsuit
brought against Geothermal LLC in 2002.  Ormat Nevada, Inc. is
part of the Ormat Group of Companies, a power technology firm in
the area of distributed generation using locally available energy
sources, including geothermal energy. The sale of Geothermal LLC
is consistent with the Company's previously announced strategy
to divest non-strategic operations.

Earnings generated from core operations (which include US Energy
Biogas Corp., USE Canada Energy Corp., and Scandinavian Energy
Finance, Ltd.) were $491,000 in the second quarter ended June 30,
2003, as compared with $662,000 in the prior year period. The
decrease was primarily a result of maintenance work at US Energy
Biogas Corp. and a provision against the income contribution from
the Company's investment in Scandinavian Energy Finance, Ltd.,
attributable to uncertainty relating to the introduction of new
tariffs by the Swedish operating company.

                      Strategic Alternatives

The Company recently announced a plan that may include the sale of
one or both of its two principal subsidiaries, Biogas and USE
Canada (subject to certain conditions as filed in its proxy
statement dated August 7, 2003).  If such Plan is approved by the
Company's stockholders, and if the aforementioned sale is
consummated pursuant to the Plan, the Company's financial position
is expected to improve from cash proceeds received from the
potential sale of assets and reduced overhead cost on a going
forward basis. Subject to stockholder approval, the Company plans
to effect a transaction under the Plan before the end of 2003.

Goran Mornhed, President and Chief Executive Officer of U.S.
Energy, stated, "While we have improved the efficiency and
profitability of US Energy Biogas and USE Canada during the past
two years, the relatively high level of debt at our largest
subsidiary, Biogas, has limited its profitability and its ability
to pay dividends to us and our partners. We believe that we have a
unique opportunity to recapitalize our balance sheet, reduce debt
and monetize the value in our current asset base.  Most
importantly, the Plan, if consummated, would provide us with
renewed financial flexibility and an opportunity to enhance
shareholder value going forward. Therefore, our board of directors
has unanimously recommended that our stockholders vote in favor
of the Plan. We urge stockholders to read the proxy statement that
has been distributed in connection with our annual stockholders
meeting, currently scheduled for September 9th in White Plains,
New York."

U.S. Energy Systems, Inc., based in White Plains, NY, is a
customer-focused provider of energy outsourcing services for large
retail customers, including industrial, commercial and
institutional end users. USEY owns, operates and/or financed 35
energy projects in North America and Western Europe, totaling the
equivalent of 264 megawatts and using combined heat and power
(CHP) technology and renewable fuels. U.S. Energy Systems has
formed a number of strategic business partnerships with leading
companies, including Cinergy Solutions, a subsidiary of Cinergy
Corp., which is a strategic investor and joint venture partner,
and Arthur J. Gallagher & Co., an international insurance
brokerage company -- http://www.usenergysystems.com

                         *      *      *

                    Going Concern Uncertainty

In its Form 10-Q for the period ended June 30, 2003, the Company
stated:

"The  accompanying condensed financial statements have been
prepared in conformity with accounting principles generally
accepted in the United States of America,  which  contemplate  
continuation of the Company as a going concern. We have  sustained  
substantial  losses  from  operations in recent years, and such
losses  have  continued through June 30, 2003. In addition, we
have used, rather than provided, cash in our operations.

"...[R]ecoverability of  a  major  portion  of  the  recorded  
asset  amounts  shown in the condensed consolidated  accompanying  
balance sheet is dependent upon continued operations of  the  
Company,  which  in  turn  is  dependent  upon  our ability to
meet our financing requirements on a continuing basis, to maintain
present financing, and to  succeed  in  our  future  operations.

"On August 1, 2003, we received a Judgment entered by the United
States District  Court of Colorado wherein we were awarded a
Judgment of $20,044,180 in the  Nukem  case.  If  the  collection  
of this Judgment is successful, it would provide  significant  
working  capital  to  the Company.

"We also continue to pursue several items that will help us meet
our future cash needs.  We are currently working with several
different sources, including both strategic and financial
investors, in order to raise sufficient capital to finance our  
continuing operations. Although there is no assurance that funding
will be available, we believe that our current business plan, if
successfully funded, will significantly improve our operating
results and cash flow in the future."


VICAR OPERATING: S&P Rates $146M Senior Secured Bank Loan at B+
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' rating to
animal hospital operator Vicar Operating Inc.'s $146 million
senior secured bank loan.

At the same time, Standard & Poor's affirmed the company's 'B+'
corporate credit rating and its 'B-' subordinated debt rating. The
outlook remains positive and reflects both the company's improving
operating performance and measures taken to improve its capital
structure.

Proceeds from the new senior secured term D notes were used, along
with on-hand cash, to refinance $166 million of outstanding senior
term C notes. The transaction reduces total debt by approximately
$20 million and lowers the interest rate on the company's senior
term notes by 50 basis points. Following the transaction, the
company's total debt outstanding is approximately $318 million.

"The low-investment-grade ratings reflect Vicar's improving but
still relatively weak financial profile," said Standard & Poor's
credit analyst Jesse Juliano. "However, this weakness is mitigated
by the company's position as the leading operator of animal
hospitals and veterinary diagnostic laboratories."
     
Los Angeles, Calif.-based Vicar (a wholly-owned subsidiary of
holding company VCA ANTECH INC.) operates about 238 animal
hospitals in 34 states and 23 veterinary diagnostic laboratories
that service all 50 states. As a consolidator of hospitals in this
fragmented and competitive industry, Vicar has a successful record
of improving the operations that it acquires and implementing its
systems and procedures to improve pricing. The company seeks to
capitalize on economies of scale and on its ability to internally
deliver laboratory services.


WESTAFF INC: Seeking Loan Covenant Waivers from Aussie Lenders
--------------------------------------------------------------
Westaff, Inc. (NASDAQ:WSTF), a leading provider of temporary light
industrial, clerical/administrative and call center staff,
reported financial results for its third fiscal quarter, which
ended July 12, 2003.

Revenues for the third quarter of fiscal 2003 were $117.1 million,
up sequentially from $116.4 million in the second quarter of 2003,
but down $2.0 million, or 1.6%, from the third quarter of fiscal
2002. Domestic revenues decreased 5.9% from the prior year quarter
primarily due to a reduction in sales for some higher volume, low
margin government business as well as softness in the domestic
economy. Revenues for international operations increased 19.0%.
Excluding the effect of exchange rate fluctuations, international
revenues increased 3.4% for the quarter.

Gross margin was 17.6% for the 2003 fiscal quarter as compared to
18.5% for the same quarter of fiscal 2002. The lower gross margin
reflects the intensely competitive pricing environment in the
domestic temporary staffing industry, which continues as a result
of a soft U.S. economy, combined with increased workers'
compensation and state unemployment insurance costs.

"We had anticipated that our third quarter revenues would be below
those of the comparable 2002 quarter," commented Westaff President
and CEO Dwight S. Pedersen, "and are concentrating our efforts on
positioning the domestic operations for growth as the economy
improves. I am pleased with the improvements in our international
operations and am anticipating continued growth in that arena.

"Our focus on our direct hire programs as one means of improving
gross margins has shown initial success, and we have increased
revenues from these programs sequentially quarter over quarter
during fiscal 2003. In addition, our Trak products continue to
elicit very positive feedback from our customers and have helped
us win some significant accounts. We believe that we are well
positioned to take advantage of future economic growth."

Selling and administrative expenses for the third quarter of
fiscal 2003 were $16.0 million compared to $16.7 million in the
fiscal 2002 quarter. As a percentage of revenues, selling and
administrative expenses were down from 14.1% in the fiscal 2002
quarter to 13.7% in fiscal 2003. The Company reported an operating
loss from continuing operations of $0.4 million for the third
quarter of fiscal 2003 as compared to operating income from
continuing operations of $0.4 million for the 2002 quarter. The
current quarter's operating loss from continuing operations has
been reduced by $1.9 million as compared to the second quarter of
fiscal 2003, primarily reflecting the positive effects of the
Company's cost containment initiatives.

"We are benefiting from the results of our concerted efforts to
reduce costs and improve productivity," continued Mr. Pedersen,
"and are very enthusiastic about the responses we are receiving
from those field offices which have migrated to our new
proprietary front-office operating system. As of August 20, 40
offices are now operating on the new system and are reporting
significant productivity improvements in timecard processing."

For the 36 weeks ended July 12, 2003, revenues were $351.4
million, with an operating loss from continuing operations of $2.9
million. This compares with revenues of $335.8 million and an
operating loss from continuing operations of $5.1 million in the
fiscal 2002 period. The fiscal 2002 loss includes restructuring
charges of $1.9 million.

During the current fiscal quarter, the Company successfully
negotiated an amendment to its Multicurrency Credit Agreement
which reset certain financial covenants and waived covenant
violations existing at the end of the second quarter. As of the
end of the third quarter of fiscal 2003, the Company's Australian
subsidiary was not in compliance with certain financial covenants
within the Australian credit facility. The Company is working with
its Australian lenders to obtain waivers for these covenants and
expects to complete this process promptly. As of July 12, 2003,
the Company had $2.8 million outstanding under the Australia
credit facility.

Westaff provides staffing services and employment opportunities
for businesses in global markets. Westaff annually employs
approximately 150,000 people and services more than 15,000 client
accounts from more than 280 offices located throughout the U.S.,
the United Kingdom, Australia, New Zealand, Norway and Denmark.
For more information, visit http://www.westaff.com  


*BOOK REVIEW: Lost Prophets -- An Insider's History of the
              Modern Economists
----------------------------------------------------------
Author: Alfred L. Malabre, Jr.
Publisher: Beard Books
Softcover: 256 pages
List Price: $34.95
Review by Henry Berry

Order your personal copy today at
http://www.amazon.com/exec/obidos/ASIN/1587981807/internetbankrupt

Alfred Malabre's personal perspective on the U.S. economy over the
past four decades is firmly grounded in his experience and
knowledge.  Economics Editor of The Wall Street Journal from 1969
to 1993 and author of its weekly "Outlook" column, Malabre was in
a singular position to follow the U.S. economy in recent decades,
have access to the major academic and political figures
responsible for economic affairs, and get behind the crucial
economic stories of the day.  He brings to this critical overview
of the economy both a lively, often provocative, commentary on the
picture of the turns of the economy.  To this he adds sharp
analysis and cogent explanation.

In general, Malabre does not put much stock in economists. "In
sum, the profession's record in the half century since Keynes and
White sat down at Bretton Woods [after World War II] provokes
dismay."  Following this sour note, he refers to the belief of a
noted fellow economist that the Nobel Prize in this field should
be discontinued.  In doing so, he also points out that the Nobel
for economics was not one originally endowed by Alfred Nobel, but
was one added at a later date funded by the central bank of Sweden
apparently in an effort to give the profession of economists the
prestige and notice of medicine, science, literature and other
Nobel categories.

Malabre's view of economists is widespread, although rarely
expressed in economic circles.  It derives from the plain fact
that modern economists, even hugely influential ones such as John
Meynard Keynes, are wrong as many times as they are right.  Their
economic theories have proved incomplete or shortsighted, if not
basically wrong-headed.  For example, Malabre thinks of the
leading economist Milton Friedman and his "monetarist colleagues"
as "super salespeople, successfully merchandising.an economic
medicine that promised far more than it could deliver" from about
the 1960s through the Reagan years of the 1980s.  But the author
not only cites how the economy has again and again disproved the
theories and exposed the irrelevance of wrong-headedness of the
policy recommendations of the most influential economists of the
day.  Malabre also lays out abundant economic data and describes
contemporary marketplace and social activities to show how the
economy performs almost independently of the best analyses and
ideas of economists.

Malabre does not engage in his critiques of noted economists and
prevailing economic ideas of recent decades as an end in itself.
What emerges in all of his consistent, clear-eyed, unideological
analysis and commentary is his own broad, seasoned view of
economics-namely, the predominance of the business cycle.  He
compares this with human nature, which is after all the substance
of economics often overlooked by professional and academic
economists with their focus on monetary policy, exchange rates,
inflation, and such.  "The business cycle, like human nature, is
here to stay" is the lesson Malabre aims to impart to readers
interested in understanding the fundamental, abiding nature of
economics.  In Lost Prophets, in language that is accessible and
jargon-free, this author, who has observed, written about, and
explained economics from all angles for several decades,
persuasively makes this point.

In addition to holding a top position at The Wall Street Journal,
Malabre is also the author of the books, Understanding the New
Economy and Beyond Our Means, which received the George S. Eccles
Prize from the Columbia Business School as the best economics book
of 1987.

                          *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets.  At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.  
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com.

Bond pricing, appearing in each Thursday's edition of the TCR, is
provided by DebtTraders in New York. DebtTraders is a specialist
in global high yield securities, providing clients unparalleled
services in the identification, assessment, and sourcing of
attractive high yield debt investments. For more information on
institutional services, contact Scott Johnson at 1-212-247-5300.
To view our research and find out about private client accounts,
contact Peter Fitzpatrick at 1-212-247-3800. Real-time pricing
available at http://www.debttraders.com/

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.

For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.

                          *********

S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published by
Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard
Group, Inc., Washington, DC USA. Yvonne L. Metzler, Bernadette C.
de Roda, Donnabel C. Salcedo, Ronald P. Villavelez and Peter A.
Chapman, Editors.

Copyright 2003.  All rights reserved.  ISSN: 1520-9474.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.  Information contained
herein is obtained from sources believed to be reliable, but is
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for the term of the initial subscription or balance thereof are
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                *** End of Transmission ***